N.C. Commissioner Signs Race-Based Premium Settlements with Trio of Companies

July 29, 2004

North Carolina Insurance Commissioner Jim Long has signed three settlement agreements with companies that reportedly participated in discriminatory rating practices in North Carolina.

The settlements with the companies, Cincinnati Life Insurance Company, American National Life Insurance Company and New York Life Insurance Company, could affect up to 1,300 North Carolina policyholders. Citizens who believe they may benefit from the settlements are urged to contact the companies at the numbers listed below.

“All three companies charged minority policyholders higher premiums based solely on their races,” Long said. “This abominable practice took place during the 1920s, ’30s and ’40s. Now, finally, those who were taken advantage of all those years ago will be able to receive repayment.”

Cincinnati Life Insurance Company, based in Ohio, is required to pay affected African-American policyholders who had coverage from 1947 to 1968 through Inter-Ocean Insurance Company. Under the settlement, which could reach $1.9 million nationwide, the company will pay policyholders or beneficiaries $75 or the amount they were reportedly overcharged for their policies plus interest. Consumers should call 1-800-841-0536 to get additional details about the settlement.

American National Life Insurance Company, based in Texas, reportedly sold policies commonly known as industrial life or burial policies at a higher cost to African-Americans and Hispanics.

The multi-state settlement estimated at up to $3.5 million applies to policies with a face amount of $1,000 or less, issued by American National between 1936 and 1939 to African-Americans and Hispanics and policies issued to African-Americans between 1948 and 1964, and where a surrender or death benefit was paid since Dec. 31, 1959. An estimated 1,100 North Carolinians could be eligible for settlement benefits. Consumers should call 1-800-229-9685 or visit www.regulatorysettlement.com to get additional details about the settlement.

New York Life Insurance Company, based in New York, reportedly issued endowment polices to African-Americans between 1920 and 1948. These endowment policies matured after a term of 10, 15 or 20 years or paid a death benefit to the beneficiary if the insured died prior to the maturity date. The settlement could reach $10 million and an estimated 168 North Carolina policyholders may be eligible for cash refunds. Consumers should call 1-866-891-0614 or 1-800-420-8141 or visit www.outreachprogram.info to get additional details about the settlement.

These three settlement agreements signed in North Carolina are reciprocal agreements that mirror the original settlements reached in the home states of each company.

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