Axa, Jackson National Reach Combined $5.78 Million Death Master File Settlements With State Commissioners
December 18, 2015 by Dennis Gorski, managing editor-online, BestWeek: Dennis.Gorski@ambest.com
SACRAMENTO, Calif. – Two more life insurers have agreed to settle complaints brought by a consortium of state insurance commissioners over business practices related to the Social Security Administration’s Death Master File.
Companies operated by Paris-based Axa S.A. and Jackson National Life Insurance Co., operated by London-based Prudential plc, will make payments of $3.28 million and $2.5 million, respectively, to the states involved in the national investigation of life insurers’ market conduct. The companies will also “reform their business practices and use the (Death Master File) database to search for policyholder beneficiaries that might be owed benefits from a life insurance policy,” according to a press statement.
“Jackson National and Axa have stepped up and done the right thing for policyholders,” said California Insurance Commissioner Dave Jones in a statement. “I urge other life insurers to follow the lead of the 22 other companies that have agreed to use the Death Master File database to search for life insurance policyholders.”
Until recently, most insurers only used the database to identify deceased annuity holders in order to stop making annuity payments, not to identify deceased policyholders in order to pay life insurance benefits, Jones claimed. Today, an estimated 73% of the life insurance market by premium volume has either agreed to comply through settlements or been found to be in compliance, he said.
Insurance commissioners for California, North Dakota, Florida, New Hampshire and Pennsylvania are leading the national investigation of life insurers. California managed the market conduct examination of Jackson National, and Pennsylvania managed the exam of Axa, Jones noted.
The commissioners’ investigation has led to life insurers returning more than $1 billion to beneficiaries nationwide, according to the statement.
Jones also chairs a National Association of Insurance Commissioners’ subgroup currently drafting a model law that would require all life insurers to use the Death Master File to identify deceased policyholders and pay beneficiaries. That process began last June with five proposals under consideration by the NAIC (Best’s News Service, June 16, 2015).
Jackson National Life Insurance Co. has a current Best’s Financial Strength Rating of A+ (Superior).
Operating insurers of Axa S.A. have current Best’s Financial Strength Ratings ranging from B++ (Good) to A+ (Superior).
Axa S.A. is the largest insurance company in the world, according to BestLink, with 2013 non-banking assets of $982.2 billion. Prudential plc is the world’s 10th-largest insurance company, with 2013 non-banking assets of $537.4 billion, according to BestLink.
