Close Close
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards

Life Health > Life Insurance

Race-Based Case Settled

Your article was successfully shared with the contacts you provided.

A U.S. District Court in New Haven, Conn., has approved a $24.4 million settlement in a case involving life insurance race discrimination allegations.

The defendant was John Hancock Life Insurance Company, Boston, which is now a unit of Manulife Financial Corp., Toronto.

U.S. District Court Judge Janet Bond Arterton signed off on the settlement agreement Friday, according to Mehri & Skalet P.L.L.C., Washington, and Klafter Olsen & Lesser L.L.P., Rye Brook, N.Y., the law firms that represented the plaintiffs in the case.

Representatives for Hancock said today the company was pleased with the court’s approval of the settlement, noting that the case involved “certain life insurance policies that were sold at least 50 years or more ago.”

John Hancock also affirmed that in its statement that it “is committed to diversity and community” and noted that the court made no finding of liability.

“In settling the case, John Hancock denied any wrongdoing [or] violation of any state or federal laws,” the company stated.

The plaintiffs filed their suit in 2004. They alleged that, before 1959, Hancock denied African-American consumers the full range of life insurance policies it offered to other consumers. Hancock also had a policy of refusing to sell life insurance to African Americans, and it refused to pay agents commissions for selling coverage to African Americans, the plaintiffs allege.

Mehri & Skalet and Klafter Olsen & Lesser say the settlement agreement calls for Hancock to set up a $24.4 million fund to pay the claims of class members. Relief would be awarded on a per-policy basis, and each class member who submits a valid claim could receive up to $1,200 per policy.

A retired U.S. district court judge, U.W. Clemon, will serve as the special master administering the fund, and the deadline for submitting claims is Nov. 19, according to the plaintiffs’ lawyers.

Unused settlement funds will be given to organizations that help African-Americans, according to the plaintiffs’ lawyers.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.