NU Online News Service, Aug. 30, 10:43 a.m. – MetLife Inc., New York, says it has negotiated agreements that could help its Metropolitan Life Insurance Company unit put complaints about old, race-based life insurance underwriting practices behind it.
Metropolitan Life has reached a preliminary agreement to settle a federal class-action lawsuit filed on behalf of affected consumers.
Metropolitan Life has also agreed to a settlement with the New York State Insurance Department that should resolve a New York department investigation of the race-based underwriting practices.
The affected customers, and the beneficiaries of customers who are already dead, could collect about $160 million in compensation, according to the New York department.
Compensation could take the form of an increased policy death benefit, a cash payment or a special settlement death benefit, MetLife says.
MetLife Chairman Robert Benmosche put out a statement emphasizing that the race-based underwriting practices at the center of the complaints were relics of the past.
“The settlement addresses policies that were issued decades ago amid circumstances that are no longer prevailing today,” Benmosche says.
MetLife began the process of equalizing policy benefits in 1948, Benmosche adds.
New York State Insurance Superintendent Gregory Serio has welcomed the MetLife settlement agreement, but he released a statement of his own arguing that the “insidious practice of race-based underwriting can never truly be remedied.”