Regulators efforts to rectify companies sales of life insurance with premiums based on race are continuing apace, said Jose Montemayor, Texas insurance commissioner.
Details of where regulators stand were outlined by Montemayor during the fall meeting of the National Association of Insurance Commissioners here.
To date, 1,600 companies have been surveyed or received regulatory scrutiny through annual statement filing reviews, he said.
Roughly 25 companies or company groups were found to have performed race-based underwriting that ranged from a handful of contracts to thousands of contracts, Montemayor continued.
A total of 40 examinations are now in progress and to date, six million policies have been adjusted to correct race-based underwriting, he added.
There has been a total of $455 million in remediation with $13 million in fines assessed to companies, he said.
“We generally believe that we have identified the majority of the cases,” he said.
Laws differ in the treatment of how far back a regulator can look in determining if race has been a consideration in underwriting, according to Montemayor. Some states allow regulators to look back as far as the Reconstruction, but other states have a more recent time limit for looking at race-based premium underwriting.
Typically, when underwriting is examined for race-based practices, the state of domicile takes the lead effort, he said.
A class-action suit in South Carolina is delaying relief from being made, he added.
Reproduced from National Underwriter Life & Health/Financial Services Edition, September 19, 2003. Copyright 2003 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.