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State announces a multimillion-dollar settlement with Lincoln National Life Insurance

With this settlement, over 55 pct of the national market has agreed to business reforms

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[December 17, 2013]  CHICAGO Last week, Illinois Department of Insurance Director Andrew Boron announced an agreement with Lincoln National Life Insurance Co., Lincoln Life and Annuity Co. of New York, and First Penn Pacific Life Insurance Co. collectively referred to as Lincoln as part of a multimillion-dollar settlement with several states regarding the companies' use of the Social Security Administration's Death Master File. Under the settlement, Lincoln will pay $12.6 million to states that are a party to the settlement.

This settlement with Lincoln stems from multistate market conduct examinations of the 40 largest life insurers regarding the timely payment of proceeds to beneficiaries of life insurance policies and annuities. The principal lead state in this investigation was Pennsylvania, with support from insurance regulators from Florida, California, Illinois, Indiana, New Hampshire and North Dakota.

"I am pleased that market conduct examinations of eight of the 10 largest insurers in the United States have been resolved," said Boron. "These life insurers, and the other smaller insurers who have settled, represent more than 55 percent of the market, and the resolutions demonstrate that the majority of the industry is now properly and fairly using the DMF."

Under the agreement, Lincoln will implement business reforms to promote a timely and efficient search for the beneficiaries of both its in-force life insurance policies and annuities, using the Social Security Administration's Death Master File. The companies will regularly match all of their insureds and annuitants against the DMF to help promptly identify when an insured has died, to locate and make payment to beneficiaries.

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A copy of the Lincoln settlement agreement (PDF) is available on the Department of Insurance website at http://insurance.illinois.gov/Home/ImpLinks.asp. Consumers who have any questions regarding this settlement, or who have any questions or concerns about their insurance, should contact the department's Consumer Division at http://insurance.illinois.gov/ or call 866-445-5364.

[Text from Illinois Department of Insurance file received from the Illinois Office of Communication and Information]
 

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