Hancock in Settlement Over Death Rewards
Saturday, May 14, 2011 by dev
California authorities accused insurer John Hancock Monetary Services Inc. of withholding rewards from widows and other beneficiaries by allegedly failing to determine if its buyers had been dead.State Controller John Chiang said the state had reached a settlement with Hancock, and said it was the very first resulting from an audit of 21 insurance firms that Mr. Chiang began practically 3 years ago.
Hancock in Settlement Over Death Rewards
In an interview, he characterized the avoidance of benefit payments as a widespread practice and said he expected to forge settlements or take actions including lawsuits against other insurers.
Boston-based Hancock said it really is "outraged by the unsubstantiated allegations and characterizations," with respect to distinct assertions in a statement Friday by the California controller's office. Even so, Hancock said it agreed to take a proactive approach to decide whether a customer has died since it sees that as the right thing to do for customers.
The dispute centers on just how far insurers should go to figure out if customers whose accounts go dormant are still alive.
A California state law normally requires organizations to annually report and deliver property to the controller's office right after there has been no consumer get in touch with for 3 years. The controller can then route the unclaimed property to its owner. Insurers, for example, ought to report accounts regarded as lost or abandoned to the state right after 3 years of inactivity, based on a spokesman for the controller. He said insurers, which includes John Hancock, have routinely failed to get in touch with the controller as necessary.
