Department of Insurance announces multistate settlement with Bankers Life and Casualty Co.

Illinois participated in multistate effort to protect consumers and will share part of a $3 million penalty against the insurance company

[November 26, 2012]  CHICAGO -- Illinois Department of Insurance Director Andrew Boron announced last week that an agreement has been reached with Bankers Life and Casualty Co., known as Bankers, as part of a multimillion-dollar settlement with several states. Under the settlement, Bankers agreed to pay $3,200,000 to states that are a party to the settlement. Illinois will receive $391,566 under the settlement.

The regulatory settlement agreement is the result of a multistate re-examination to investigate Bankers' practices. The re-examination, also considered a follow-up investigation, was required as part of a 2008 settlement with Bankers that said the lead regulators would conduct a follow-up examination of Bankers after the initial examination in 2007.

The re-examination determined that Bankers failed to come into full and timely compliance with respect to four recommendations of the 2007 Exam Report, which were related to alterations of applications, maximum benefit claims denials, timely claims investigation and claims settlements. These four issues of noncompliance related to the annuities, long-term care and life insurance lines of business.

"We applaud the cooperative efforts of our fellow regulators in working together to protect consumers," said Boron. "This settlement demonstrates the diligence exercised by all the parties in following up on violations found in an earlier examination and ensuring compliance on the part of the company."

In addition to Illinois, states participating in this settlement agreement are Indiana, Pennsylvania, Texas and Florida.

A copy of the settlement agreement is available at 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.

The mission of the Illinois Department of Insurance is to protect consumers by providing assistance and information, by efficiently regulating the insurance industry's market behavior and financial solvency, and by fostering a competitive insurance marketplace. The department assists consumers with all insurance complaints, including health, auto, life and homeowner.

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