Focused Information Service (Press Releases)
Superintendent of Monetary Companies Linda A. Lacewell at present introduced that the Division of Monetary Companies (DFS) has fined American Progressive Life and Well being Insurance coverage Firm of New York $260,000 for rescinding sure life insurance coverage insurance policies with out the consent of policyholders.
“American Progressive took the ability of selection from shoppers into their very own fingers – an unacceptable and unlawful plan of action,” stated Superintendent Lacewell. “We count on insurers to play by the foundations and the Division will take motion to make sure they do.”
A DFS investigation ensuing from a shopper criticism discovered that from 2010 to 2019 American Progressive rescinded decreased paid-up life insurance coverage insurance policies with a money worth of $500 or much less and paid the money worth to 260 policyholders with out the consent of the policyholders, in violation of New York Insurance coverage Legislation. The recognized insurance policies initially had a complete face quantity of $2,333,438 and whole decreased paid-up dying advantages of $32,945.
Underneath at present’s order, American Progressive will current a remediation for restitution plan to policyholders or their beneficiaries for every violation. Underneath the plan, American Progressive will establish insurance policies that it rescinded with out consent of the policyholders. The corporate will give these policyholders the choice of selecting to place their insurance policies again in pressure with out searching for to recoup any funds paid out as a part of the unauthorized rescissions of the insurance policies. Instead, shoppers could obtain a further cost reflecting the distinction between the give up worth beforehand paid and the decreased paid-up dying profit.
A duplicate of the consent order (https://www.dfs.ny.gov/system/information/paperwork/2019/09/ea190917_american_progressive.pdf) may be discovered on the DFS web site.