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Written by: Editor

Published: 16 January 2012

UPPER LAKE, Calif. – The North Shore Business Association will hold a meeting on Wednesdsay, Jan. 18.

The group will meet for breakfast at 7 a.m. at Judy's Junction, 375 E. Highway 20 in Upper Lake.

For those who just want to network, they can arrive at 7:30 a.m.

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Written by: Editor

Published: 14 January 2012

SACRAMENTO – State Controller John Chiang on Friday announced a major multistate settlement with Prudential Insurance Company of America, which, depending on the completion of the audit, may return up to $20 million to the families of deceased life insurance policyholders in California.

"For decades, the surviving families of policyholders have been cheated by life insurance companies who either knew or should have known that payout was due," said Chiang. "I will continue to work with the industry to improve their practices, but I reserve the right to use the full force of my office – including litigation – to compel insurance companies to follow the law and take care of life insurance beneficiaries."

The controller took the lead in negotiating the settlement, which 18 other states subsequently joined. Chiang reached a similar agreement with insurer John Hancock in April 2011.

Both settlements stem from a 21-company audit Controller Chiang initiated in 2008 to determine the insurance industry's compliance with state unclaimed property laws.

Administered by the controller, the California unclaimed property program generally provides that businesses must send lost or abandoned financial accounts to the state after three years of inactivity in order to safeguard private property from being lost during mergers or bankruptcies, drawn down by service or storage fees, or simply used by private interests.

The audit revealed an industry-wide practice of companies failing to pay death benefits to the beneficiaries of life insurance policies.

Instead, companies would draw-down the policies' cash reserves in order to continue collecting premium payments from the deceased. Once the cash reserves were depleted, the company would cancel the policy.

The audits also found that insurers did not routinely cross-check the owners of dormant accounts with the Social Security Administration's Death Master File and other government databases listing deceased individuals.

In other cases, the company had direct knowledge of the death of a policy owner, but still did not notify the beneficiaries.

So far, more than 1,000 Prudential policies have been identified as being held for individuals in California who have been dead for more than 15 years. The average cash value of the policies is about $2,000.

Today’s settlement requires Prudential Financial Inc., and its predecessors and subsidiaries (Prudential Insurance Co. of America, Pruco Life Insurance Co., Pruco Life Insurance Co. of New Jersey, Prudential Retirement Insurance and Annuity Co., and Prudential Annuities Life Assurance Corp., formerly known as America Skandia Life Assurance Corp.) to do the following:

• Restore the full value of impacted accounts;

• Fully comply with California’s unclaimed property laws and cooperate with the Controller's efforts to reunite millions of dollars in death benefits and matured annuities with their owners or, in many cases, the owners' heirs;

• Pay the beneficiaries three percent compounded interest on the value of the held amounts from the date of the owner’s death or January 1, 1995, whichever is later.

Other states signing the settlement are: Colorado, District of Columbia, Idaho, Louisiana, Maine, Maryland, Massachusetts, Mississippi, Montana, Nebraska, North Dakota, Oregon, Pennsylvania, South Dakota, Tennessee, Utah, Vermont and Wisconsin.

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Written by: Editor

Published: 13 January 2012

This week California Insurance Commissioner Dave Jones announced the California Department of Insurance (CDI) recovered more than $54 million for consumers through consumer complaint investigations and market conduct examinations of insurance companies in 2011.

"Protecting consumers is this Department's top priority," said Commissioner Jones. "Thanks to a lot of hard work by Department staff, we were able to recover more than $54 million for the people of California. Our consumer complaint services and market conduct exams are important tools that we employ to respond to the needs of consumers and proactively go after any activities that pose a threat to policyholders."

CDI's Consumer Services and Market Conduct Branch has two divisions – one focuses directly on helping consumers and the other focuses on examinations of insurance companies' actions through an examination process.

The Consumer Services Division operates the Consumer Communications Bureau, which handles the

(800) 927-HELP consumer hotline; the Health Claims Bureau; Claims Services Bureau, and the Rating and Underwriting Services Bureau investigate and resolve complaints filed with the Department by consumers and others. The consumer hotline annually receives about 200,000 calls.

Through its complaint handing efforts, the Consumer Services Division recovered over $49 million for consumers in 2011.

Further, the Market Conduct Division recovered approximately $5 million for consumers and 114 exams of insurance companies were adopted by the Commissioner.

The Market Conduct Division consists of the Field Claims Bureau and a Field Rating and Underwriting Bureau.

These bureaus perform examinations of insurance company claims, underwriting, rating and marketing practices to ensure they are in compliance with state laws and regulations.