June 5, 2012
Department of Insurance settlement with Prudential protects Missourians with life insurance policies
Company will change its practices, pay more than $200,000
Jefferson City, Mo. - The Missouri Department of Insurance has reached a settlement with one of the nation's largest insurance companies after an investigation into the handling of life insurance benefits. Insurance Director John M. Huff today announced that Missouri is part of a $17 million multistate settlement with Prudential Insurance Company of America and some of its affiliates.
The settlement is a result of a multistate examination of Prudential's use of the Social Security Administration's Death Master File, which allows insurance companies to find information about deceased policyholders. The exam revealed that while Prudential used the Master File to stop paying consumers' annuity benefits, it did not use it as aggressively to find and pay beneficiaries of life insurance policies.
"Consumers faithfully pay life insurance premiums - often for decades - to protect the ones they love," said Huff. "With this agreement, Prudential's Missouri customers can rest assured the company will do everything it can to find and pay their survivors the benefits that are legally theirs."
The settlement requires Prudential to regularly check the Death Master File. If any of its life insurance policyholders has died, Prudential must conduct a thorough search for beneficiaries, using all contact information in its records and online search and locator tools. If it can't find beneficiaries, Prudential must turn the proceeds over to the Missouri State Treasurer's office as required by state unclaimed property laws.
The settlement requires Prudential to pay $17 million to multiple states for examination, compliance and monitoring costs. Missouri's share of the payment is $224,081.
The Department of Insurance also offers help to consumers looking for life insurance policies on deceased loved ones. Consumers can submit a search form to the department's Life Policy Locator, which triggers a search for policies among licensed life insurers in Missouri. If a policy is located, the insurance company will notify beneficiaries.
Consumers with complaints about life and other types of insurance, as well as general questions, can call the department's Insurance Consumer Hotline at 800-726-7390 or visit insurance.mo.gov.
About the Missouri Department of Insurance, Financial Institutions & Professional Registration
The Missouri Department of Insurance, Financial Institutions and Professional Registration (DIFP) is responsible for consumer protection through the regulation of financial industries and professionals. The department's seven divisions work to enforce state regulations both efficiently and effectively while encouraging a competitive environment for industries and professions to ensure consumers have access to quality products.