TALLAHASSEE, Fla. – Florida Insurance Commissioner Kevin McCarty announced today that a life claim settlement agreement has been reached with Transamerica Life Insurance Company (Transamerica) and its affiliates.
The Transamerica settlement represents the eighth life claim settlement agreement for Florida. Presently, the state insurance regulators have either reached settlements or concluded the investigation of nine of the top 20 companies constituting over 45% of the total market. Nationally, the priority is focused on the remaining examinations of more than 30 top life and annuity insurers in this market.
All of the settlements concentrate on the insurers’ asymmetrical use of the U.S. Social Security Death Master File (DMF) and the practice of using it to stop paying a deceased person’s annuity, but not using it to search for beneficiaries of a life insurance policy to determine if benefits were due. As part of the settlement agreements, insurers are now required to use it in locating beneficiaries and must promptly remit payment to the unclaimed property division of each state for beneficiaries that cannot be located.
As a result of this process, regulators predict the overall anticipated payouts will eventually reach up to $3 billion to beneficiaries directly and through the states. The estimated amount of property to be reported nationally for the Transamerica settlement is $137 million.
The multistate examination process is guided and coordinated by the Life/Annuities Claim Settlement Practices Task Force, established by the National Association of Insurance Commissioners (NAIC) in 2011 and chaired by Commissioner McCarty. The Transamerica examination was lead by Illinois, along with Florida, California, North Dakota, New Hampshire and Pennsylvania. The agreement is between the Florida Department of Financial Services (DFS), overseen by Chief Financial Officer Jeff Atwater, the Florida Office of the Attorney General (AG), overseen by Attorney General Pam Bondi, and the Florida Office of Insurance Regulation (Office) and the other lead states.
“Our vigilance is paying off and this settlement further validates our continued progress to correct this industry-wide practice, while also ensuring Floridians and all Americans receive the benefits to which they are entitled,” stated Kevin M. McCarty, Florida’s Insurance Commissioner.
“As a result of this agreement and our continuing efforts to help consumers dealing with wrongful insurance company practices, Florida families will finally be able to receive the money they are owed,” CFO Atwater said. “We will continue to be diligent in our efforts to ensure insurance companies meet their financial obligations.”
"We will remain steadfast in our efforts to ensure that life insurance beneficiaries receive the benefits that they are entitled to receive. This multi-million dollar settlement with Transamerica requires them to take the necessary steps to identify and pay beneficiaries in a timely manner,” said Attorney General, Pam Bondi.
As part of the agreement, Transamerica agreed to:
· Compare all company records against the DMF Update File every month and against the Complete DMF file at least annually from
the Agreement effective date.
· Provide the lead states quarterly reports about the implementation and execution of the requirements of the Agreement for 36
months following its conclusion.
· A follow-up examination to determine compliance 39 months following the conclusion of this Agreement.
This agreement also requires payment of $11.2 million to the participating states. Florida’s share of the allocation is expected to be more than $1,049,887.
For more information about this issue, visit the Office’s Life Claims Settlement Practices website page. To search for or claim unclaimed property, visit www.FLTreasureHunt.org, or call 1-88-VALUABLE or (850) 413-3089.
About the Florida Office of Insurance Regulation
The Florida Office of Insurance Regulation (Office) has primary responsibility for regulation, compliance and enforcement of statutes related to the business of insurance and the monitoring of industry markets. For more information about the Office, please visit www.floir.com or follow us on Twitter @FLOIR_comm.