WASHINGTON—Metropolitan Life Insurance Company said Thursday in a securities filing that it will take a charge of $125 million related to its unclaimed property practices.
The filing was made in anticipation of its quarterly earnings announcement, planned for Oct. 27. The charge to earnings will be 12 cents a share.
While MetLife officials said the charge was related to an internal investigation that began before any state probes into its policies, the decision confirms a National Underwriter article Sept. 5 indicating that state probes into life insurer unclaimed property practices are escalating.
Specifically, a securities analyst said today in an investment note that MetLife is under investigation by 30 states for its unclaimed property practices.
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The investment note, by Randy Binner, of FBR Capital Research, Arlington Va., also said that “our assumption is that this could broadly be an issue for other life insurers, but perhaps larger insurers would be more at risk as various state interests could see them as a larger source of funds.”
For example, the New York Insurance Department has issued so-called “308 letters” requesting data on the issue from all 172 life insurers registered in the state.
And, the New York Attorney General’s office has issued subpoenas to nine large insurers related to “unclaimed insurance policy proceeds that are supposed to be turned over to the state,” according to several industry lawyers.
There is a also an NAIC task force of 10 states looking into the issue.
A plaintiff’s lawyer in New York who is litigating several cases involving unclaimed property with MetLife called the sum “substantial.”