Conseco Class Action Settlement Summary

Note: This FAQ summarizes the terms of the settlement to help Missouri class members making their decisions. Although the summary was developed based upon review of the settlement documents by department staff, the department cannot guarantee the accuracy or completeness of the summary because it was not a party to the settlement. The actual terms of the settlement are ultimately controlled by the stipulation of settlement documents entered into by the parties and the notice documents received by the class members.

More than 27,000 Missouri current and former policyholders of Conseco Senior Health Insurance Co. and its subsidiaries received notices in early January of a possible class-action lawsuit settlement on long-term care insurance coverage.

Filed initially in mid-2000, the litigation alleges Conseco improperly handled rate increases or concealed the likelihood of those hikes on about 750,000 such policies nationwide, many of them originally written by American Travellers Life or J.C. Penney Life before that business was purchased by Conseco.

The case has not gone to trial, but the Philadelphia judge presiding over the case has allowed the plaintiffs and Conseco to circulate a proposed settlement offer. The proposed settlement agreement is still subject to judge's approval.

If current and former policyholders do not want to participate — and reserve their rights to pursue independent legal action — they must postmark requests to opt out of the class-action case by Jan. 22.

Those who do not opt out then have until Feb. 4 to select from several options offered in the proposed settlement. Some of these options are subject to Conseco's medical underwriting, which could disqualify class members based on their health history. However, if you are disqualified from the policy you prefer, you can keep your current policy

In no case does the proposed settlement reduce the Missouri Department of Insurance s authority to take action in the future against Conseco in response to any violations of state law or failure to comply with the terms of insurance contracts.

Below are answers to "frequently asked questions" about the settlement offer.

Policyholders are divided into four groups:

What options are available to current policyholders who are not being paid benefits?

Missourians currently insured under a long-term care or home health care policy have the following options with respect to each policy:

In addition to these benefits under Option 1, 2 or 3, you can purchase an annuity issued by Conseco and the company will match 5 percent of the initial premium paid by you or the company will match 50 percent of the first year premiums paid by you on a Conseco Universal life insurance policy (up to a maximum of $500). If you elect to opt out, or if you do not respond at all, this option is not available.

With regard to the annuity or life insurance policy, you may transfer the discounts to a family member rather than use them yourself.

What options are available to former policyholders who discontinued their policies within 60 days of a rate increase?

What options are available to persons who cancelled their policy more than 60 days after a rate the increase? Or to deceased persons' estates?

What options are available to persons currently receiving benefits?

Who do I contact with questions?

Call the Class Action Settlement Administrator at: 1-877-229-3830 or see the Conseco Settlement web site.

Why did I get this mailing from Conseco? I don't have a Conseco policy.

This class-action lawsuit against Conseco concerns all persons who bought long-term care and/or home health-care policies since 1975 from Conseco or any companies or lines of long-term care policies that the company bought during that period. Included are:

Conseco Senior Health Insurance Co. (except for Preference and FQ series)
American Travelers Life Insurance co.
Great Republic Life Insurance Co.
Transport Life Insurance Co.
Universal Fidelity Life Insurance Co.
Pioneer Life Insurance Co.
Conseco Life Insurance Co. of New York (except for Preference, FQ, and Solutions series)
J.C. Penney Life Insurance Co.
Continental Life Insurance Co.
National Group Life Insurance Co.
Health and Life Insurance Co. of America.

If you received this mailing, you should have a long-term care policy with one of these companies or allowed such a policy to end through cancellation or discontinuing payments.

How do I opt out of the class action lawsuit?

If you choose to opt out of the class action, you must send a written request for exclusion postmarked by Jan. 22, 2002. The request must include your name and address, and, if you are requesting exclusion on behalf of someone else, the capacity in which such person is acting.

The request must be sent to:

LTC/HHC Settlement
P.O. Box 455
Excelsior, MN 55331-0455.

Web Address: http://www.ltchhcsettlementagreement.com/index.htm

Where do I file objections about the settlement, if I act by Jan. 22?

If you choose to opt out of the class action, you must send a written request for exclusion postmarked by January 22, 2002. The request must include your name and address, and, if you are requesting exclusion on behalf of someone else, the capacity in which such person is acting.

The request must be sent to these four parties:

LTC/HHC Settlement
P.O. Box 455
Excelsior, MN 55331-0455.

Clerk of Court,
516 City Hall
Philadelphia, PA 19107

Allan Kanner, Esq.
Allan Kanner & Associates, P.C.
701 Camp Street
New Orleans, LA 70130

Mindy J. Spector, Esq.
Weil, Gotshal & Manges LLP
767 Fifth Ave.
New York, NY 10153

In your objection, note that you are referring to the following:

Case No. 03775
Irene Milkman, plaintiffs
v.
American Travellers Life Insurance Co., a Pennsylvania corporation, ATL Life Insurance Co., and Conseco Senior Health Insurance Co., a Pennsylvania corporation.