Florida Announces a $3.3 Million Multi-State, Multi-Agency Life Claim Settlement Agreement with Midland
TALLAHASSEE, Fla. – Florida Insurance Commissioner Kevin McCarty today announced a $3.3 million life claim settlement agreement has been reached with two companies (Midland National Life Insurance Company and North American Company for Life and Health Insurance) who are collectively referred to as “Midland.”
The settlement agreement with Midland and other similar insurers focuses primarily on the asymmetrical use of the Social Security Administration’s Death Master File (DMF) to cease making annuity payments, but not to search for beneficiaries of a life insurance policy who may be due benefits. Midland has agreed to implement business reforms correcting this practice and to make a multi-million dollar payment, which will be disbursed among the participating states. Florida’s allocation of the $3.3 million payment is expected to be more than $282,761.
The multi-state examination was conducted by Florida, California, Illinois (managing lead state), Iowa, New Hampshire, North Dakota, and Pennsylvania. Along with these states, the agreement includes the Florida Department of Financial Services (DFS), the Florida Office of the Attorney General (AG), and the Florida Office of Insurance Regulation (Office).
The settlement agreement requires implementation of the following business practices and reform measures:
· Compare all company records against the DMF Update File every month and against the complete DMF file at least annually.
· Provide quarterly reports to the lead states 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.
Established in 2011, the multistate examination process is guided and coordinated by the NAIC Life/Annuities Claim Settlement Practices Task Force, which is chaired by Commissioner McCarty.