NU Online News Service, Jan. 27, 2004, 4:47 p.m. EST – Cincinnati Life Insurance Company could end up paying as much as $1.9 million to make up for a predecessor company’s past race-based pricing practices.[@@]
The Cincinnati insurer, a unit of Cincinnati Financial Corp., negotiated the settlement with officials at the Ohio Department of Insurance and plaintiffs in a civil lawsuit, Cone vs. Cincinnati Life Insurance Company.
The Ohio department began looking into the matter after Cincinnati Life told the department that Inter-Ocean Insurance Company used race-based mortality tables when pricing small life insurance policies sold door-to-door from the 1940s to the mid-1960s.
Cincinnati Financial, a company that focuses mainly on selling property-casualty insurance, acquired Inter-Ocean in 1973 and merged it with the Cincinnati Life subsidiary in 1988.
The Ohio department has included the terms of the race-based pricing agreement in a consent order, and the Butler County, Ohio, state court that is hearing the Cone suit has given the agreement preliminary approval, Cincinnati Life says.
Cincinnati Life could pay as much as $1.9 million in fines, remediation benefits and policy enhancements if all current and former policyholders come forward, the company says.