214M Insurance Settlement Approved

Sunday, September 10th 2000, 12:00 am
By: News On 6

NASHVILLE, Tenn. (AP) — A federal judge has approved a $214 million settlement of a class-action lawsuit claiming American General Life and Accident Insurance Co. overcharged black and low-income policyholders for burial insurance.

U.S. District Court Judge John Nixon on Friday also approved a prosecutors' request for $24.1 million in fees and another $500,000 for the defense.

Nashville-based American General Life and Accident agreed to the settlement in June. The settlement covers some 9.1 million black and white policyholders nationwide.

Many of the policies were sold by companies American General Life and Accident acquired over the years. Customers will be compensated at least $150 for each policy and may receive additional benefits, including premium reductions.

Similar discrimination suits are pending against other insurance companies, including Prudential Insurance Co. of America and MetLife.

American General Life and Accident also has agreed to a $1.2 million regulatory settlement with Florida's insurance regulator, which led the investigation of the company.

Regulators in 33 other states will split another $5.8 million.