MA To Receive $1.7 Million From Insurance Groups

Posted by Spencer Matthews

Joseph G. Murphy, the Commissioner of the Patrick-Murray Administration’s Division of Insurance, on Wednesday announced that the Commonwealth of Massachusetts has joined in multi-state agreements with the Metropolitan Life Insurance Group and the Prudential Insurance Group over improper use of the Social Security Administration’s (SSA) Death Master List.

The Commonwealth will receive nearly $1.7 million in penalties from the insurers, which have admitted to inappropriate practices and procedures regarding funds they held or owed under life insurance policies, annuity contracts and retained asset accounts. Massachusetts is one of a number of states which are parties to the settlement agreements.

“These settlement agreements underscore the value of interstate cooperation in the insurance arena,” said Commissioner Murphy. “More importantly, consumers, and especially families who have lost loved ones and found themselves battling large insurers over what they were rightfully owed, now can take some small comfort in knowing that industry regulators have been at work on their behalf, in Massachusetts and across the country.”

In both cases, MetLife and Prudential were not making an effort to determine when policyholders had died, and they had not made a concerted effort to identify beneficiaries. By linking to the Social Security list, the companies have a means of identifying policyholders who have died.

Under the agreements, the Metropolitan Life Insurance Group and Prudential Insurance Group companies have agreed to regularly check the SSA Death Master List or a similar source of death records to determine if their life insurance policyholders, annuity owners or retained-asset account holders have died. The insurers will then make efforts to locate beneficiaries and pay claims timely. If no beneficiary is located within one year of the date of a match, the insurers will report the funds as unclaimed property to the appropriate state entities.

“Our state insurance regulators work every day on behalf of consumers in Massachusetts,” said Barbara Anthony, Undersecretary of Consumer Affairs, the parent agency of the Division of Insurance. “Settlements and agreements such as these make clear that we will do all in our power to protect the citizens and the families of the Commonwealth.”

The Metropolitan settlement also requires quarterly reporting to the states for the next three years, with a final re-examination to occur at the end of that period. The Prudential settlement demands quarterly reporting for a period of five years, and will also culminate with a final re-examination.

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Posted by Spencer Matthews on Jul 12 2012. Filed under Business, Featured - For home page featured article. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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