HARRISBURG, Pa., Feb. 2, 2012 /PRNewswire-USNewswire/ -- The Pennsylvania Insurance Department is among seven lead states that today announced a settlement with Prudential Insurance Company of America and some of its affiliates.
"Our multi-state exam revealed concerns with Prudential's practices in the payment of death benefits to the beneficiaries of life insurance policies," Insurance Commissioner Michael Consedine said. "We appreciate Prudential's willingness to reach a settlement that includes changing its business practices to better locate beneficiaries. This will provide consumers with even greater protections."
Under the agreement, Prudential will use the Social Security Administration's Death Master File on a uniform basis for locating beneficiaries and making payments to them. It also requires Prudential to pay a total of $17 million to those states participating in the agreement.
"One of the top consumer questions we receive at the Insurance Department is how to determine if a deceased loved one had life insurance," Consedine said. "Since there is no data bank of this sort of information, it is necessary that the companies do as much as they can to find beneficiaries. To its credit, Prudential will now be a leader in implementing systematic and timely procedures to identify beneficiaries of possibly deceased policyholders. We hope this will serve as a blueprint for a way forward for other life insurance companies.
"This settlement was the result of a truly collaborative effort between state insurance regulators across the country and serves as a positive example of the coordinated market conduct efforts of our state-based insurance system."
The agreement becomes effective after 20 states sign it. Currently, Florida, California, Illinois, New Jersey, New Hampshire and North Dakota have signed the agreement in addition to Pennsylvania. Pennsylvania was the lead coordinating state.
To see a copy of the settlement agreement, visit www.insurance.pa.gov and click on "consumer protection." Consumers with life insurance questions should call the department's toll free number 877-881-6388.
Media contacts: Rosanne Placey or Melissa Fox, 717-787-3289
SOURCE Pennsylvania Insurance Department
