Prudential Improperly Collected Life Insurance Premiums and Informed Claimants They 网曝吃瓜re Ineligible
From the desk of Jim Eccleston at 网曝吃瓜
The Department of Labor (DOL) has agreed to a settlement with Prudential after the insurer improperly collected life insurance premiums from customers and subsequently denied coverage claiming ineligibility.
Prudential improperly denied nearly 200 life insurance claims filed between 2017 and 2020, according to the DOL. The policies, which would have paid out between $3 to $7 million, were part of employer-sponsored insurance where some workers had opted in for supplemental coverage. According to the DOL, Prudential denied claims in cases where workers chose coverage in plans that utilized a different company as the record keeper. When Prudential is a group plan’s record keeper, it often determines whether a worker meets the criteria for supplemental coverage. However, when a different company serves as record keeper, the company doesn’t ensure that workers are eligible for those policies even while collecting premiums that are sent to Prudential, according to the settlement.
“Participants were paying premiums for life insurance policies that never existed. The DOL will continue to work to end this disturbing practice, and we urge all insurers to examine their practices to ensure they do not engage in similar conduct”, according to the DOL. The DOL further noted that “parallel investigations have found that other life insurers also engaged in similar practices”, but no other companies were named. The settlement agreement now restricts Prudential from denying life insurance claims on the basis of ineligibility if the company has collected premiums for more than three months.
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