Florida Office of Insurance Regulation (FLOIR) has settled an agreement among 37 jurisdictions and Conseco Life Insurance that requires establishment of $10m fund for certain owners of its Lifetrend life insurance products.
According to FLOIR, it led the multi-state effort with insurance regulators from California, Iowa, Indiana, and Texas. The sale and administration of Lifetrend policies were reviewed after receiving complaints from consumers who had received notices in fall of 2008 regarding increases in policy costs.
In addition to settlement fund, Conseco will also pay a $1m monetary assessment to jurisdictions participating in the settlement. Its share of assessment will be around $200,000, based on a formula outlined in the agreement.
The settlement agreement also requires Conseco Life and its affiliates Conseco Insurance, Conseco Health Insurance, Bankers Life and Casualty, and Washington National Insurance to enhance their processes for identifying and correcting administrative system issues. They will undergo a two-year process enhancement monitoring period.
Kevin McCarty, insurance commissioner of Florida, said: “I am pleased to report Florida has worked collaboratively with the other lead states to reach an agreement with Conseco. Conseco has agreed to create a multi-million dollar settlement fund to provide relief to policyholders in Florida and nationally who purchased Lifetrend policies.”