Insurer settles charges that it slow-paid on LTCI claims

On follow-up exam, regulators found Bankers Life had not fully implemented previous recommendations

Nov 21, 2012 @ 1:49 pm

By Darla Mercado

Bankers Life and Casualty Co. will pay $3.2 million in a settlement with insurance regulators after examiners found that the insurer failed to make suggested updates to its claims practices.

The Pennsylvania Insurance Department was among the regulators participating in a multistate settlement agreement following the re-examination of Bankers Life. Illinois, Indiana, Florida and Texas were also lead regulators conducting the regulatory review.

In addition to the $3.2 million fine, the carrier will pay $800,000 to the lead regulators on the case to cover costs related to the re-examination.

Examiners visited Bankers Life on Feb. 8, 2010, in accordance with a 2008 settlement with the company. Back in 2007, regulators conducted a market examination report on Bankers Life and its then-sister company, Conseco Senior Health Insurance Co. At that time, authorities found that pending claims were not investigated in a timely manner and that claim files were not properly documented or kept.

As part of the ensuing 2008 settlement, regulators came up with a list of suggested corrective actions for the companies to take. In that agreement, insurance officials also said they would conduct a re-examination of Bankers Life.

In this latest checkup in 2010, authorities found that Bankers Life still hadn't revised its procedures to ensure that claims were paid and that claim investigations were completed in a timely manner.

Bankers Life also failed to update its underwriting practices to ensure “complete and accurate” applications, and the insurer did not revise its maximum-benefit claim denial letters to include details of a restoration of benefits provision in the contract, according to regulators.

Authorities in Pennsylvania indicated that the noncompliance affected the carrier's annuities, long-term-care insurance and life insurance businesses.

The company neither admitted nor denied the regulators' findings.

“We are pleased the examination is now resolved, and we appreciate the cooperation of Pennsylvania and the other lead states throughout the process,” said Bankers Life spokeswoman Barbara Ciesemier. “The original examination dealt with a number of legacy issues, and the re-examination confirmed significant progress and improvement on those areas, which the company continues to work to address.”

0
Comments

What do you think?

View comments

Recommended for you

Featured video

Events

Geoffrey Brown: What's top of mind at NAPFA?

NAPFA is looking ahead at the rest of 2018 and has a broad agenda that includes improving diversity in the advice industry. What's next? Geoffrey Brown offers his insights.

Latest news & opinion

10 fastest-growing IBDs

These independent broker-dealers saw the biggest percentage gains in their revenue in 2017.

The unique nature of working with celebrity clients

Athletes and entertainers are just like everyone else — aside from complex tax issues, a lack of financial savvy and a need for prenups

Top 10 IBDs ranked by revenue

These independent broker dealers generated the most revenues in 2017.

8 podcasts advisers listen to when they aren't working

Listening to podcasts for the fun of it.

UBS continues to cut loans to recruits, while increasing compensation to brokers

The wirehouse reduced recruitment loans 20% and increased bonus loans 68% in the first quarter.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print