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Monumental Life Agrees to Return an Estimated $650,000 to More than 9,000 Florida Policyholders

10/27/2003

CONTACT: Justin Glover
(850) 413-2842

TALLAHASSEE—As part of a nationwide settlement to pay as much as $37 million in increased death benefits to affected policyholders, Maryland-based Monumental Life Insurance Company has agreed to pay an estimated $650,000 in increased death benefits to more than 9,000 Florida policyholders, Chief Financial Officer Tom Gallagher announced today.

"This settlement marks another step toward eliminating race-based practices by taking action to correct past injustices," Gallagher said. "We will continue working to ensure that all policyholders have fair and equal access to the insurance coverage they need."

Investigators found that many of Monumental Life's subsidiaries, which were purchased or acquired, engaged in race-based pricing of their life insurance policies after 1974. More than 600,000 policyholders are affected nationwide. Almost all of the policies in question are small-value life insurance policies, also known as burial or industrial policies. These kinds of policies were sold at higher prices to non-whites by many companies nationwide until the 1970s.

The settlement reached with Monumental Life ensures that all policyholders receive non-discriminatory death benefits. Notices of increased death benefits on current Florida policies have already been mailed by Monumental Life to known Florida policyholders. In addition, some payments to past beneficiaries have already been made. More Floridians who are entitled to increased benefits may be identified.

Upon signing the agreement, Florida Office of Insurance Regulation Director Kevin McCarty said, "This settlement demonstrates the effectiveness of state insurance regulators working together to resolve discriminatory practices of the past."

Under the terms of the settlement, Monumental Life must attempt to locate all affected policyholders and fund a nationwide advertising campaign to notify potential claimants of the settlement. Monumental Life has provided a toll-free number to call for information on how to obtain benefits: 1-877-216-0949. Consumers may also call the Department of Financial Services toll-free helpline at 1-800-342-2762.

Since 1999, the Florida Department of Financial Services has negotiated settlements with several other companies engaged in raced-based pricing including American General, Unitrin, Life Insurance Company of Georgia and MetLife.