A Midwestern life holding company has agreed to increase policyholder benefits to resolve an investigation of the sales practices used by some of the insurers the company has acquired.
Americo Life Inc., Kansas City, Mo., will compensate consumers affected by the acquired subsidiaries past race-based pricing practices by adding 25% to the face amount of affected policies, according to officials with the Texas Department of Insurance.
All valid claims under the settlement will be honored for a period of 4 years, officials say.
The Texas department served as the lead negotiator for a 5-state team that represented members of the National Association of Insurance Commissioners, Kansas City.
Representatives for Americo were not immediately available for comment.
The settlement affects industrial life policies sold by life insurers now owned by Americo at a higher cost or with lesser benefits than policies sold to white customers, officials say.