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May 23, 2013 at 09:23 AM
Three insurance company units of Cigna Corp. (NYSE:CI) have agreed to set aside about $79 million to resolve state regulators’ concerns about disability insurance claim handling practices.
The units — Life Insurance Company of North America, Connecticut General Life Insurance Company, and Cigna Health and Life Insurance Company — have negotiated the settlement agreement with the insurance regulators in California, Connecticut, Maine, Massachusetts and Pennsylvania.
Cigna will make $29 million available for claims that are still open, $48 million for reserves that could be used to pay for additional benefits in the future, and $1.675 million for fees and fines, officials said.
In addition to agreeing to set aside cash, Cigna has agreed to change its claim procedures to give more weight to Social Security Disability Insurance (SSDI) benefits awards, improve the way it gets medical information, set new guidelines for use of outside medical resources, use a new process to choose independent medical examiners, and accept new quality monitoring procedures, according to a copy of the settlement agreement posted on the Web.
Cigna talked about the charges in the “regulatory matters” section in a financial report it filed recently with the U.S. Securities and Exchange Commission (SEC).
Cigna said in a statement that it is a “customer-centric company with a focus on providing responsive service and timely and accurate claims handling for all of our long-term disability customers.”
