American International
Group, Inc.(NYSE:AIG) is reported to be paying more than $300 million to resolve
a dispute with states over life insurance payments that go unclaimed, as per
California’s finance office.
In an agreement over
unclaimed property, AIG will be paying an estimated amount of $300 million owed
on life insurance claims, as per a spokesman for Jacob Roper, a California
State Controller’s spokesman. The payment will be reportedly divided among 39
states and the District of Columbia.
California’s share will
be somewhere between $25 million and $30 million.
In a separate agreement
that was announced on Monday, AIG settled to pay $11 million to insurance
regulators.
AIG is now a part of a
roster of insurance companies that have pledged to alter the way they handle
life insurance claims. It was last week when Nationwide had agreed upon paying
$7.2 million in a similar agreement with insurance regulators of the state. According
to reports, Prudential and MetLife have made akin arrangements.
There was no immediate
response from Jim Ankner, a spokesman at AIG, when he was called.
Florida’s insurance
commissioner, Kevin McCarty has praised the settlement with AIG in a statement.
He said that it has been pleasing that AIG has signed the agreement and vowed
to fix its practices to correctly discover worthy beneficiaries. He feels that impetus
is building within the industry to alter their practices, pay beneficiaries and
reach agreement with fitting regulatory jurisdictions to resolve problems
associated with past practices.
Based in New York City,
AIG said that the $11 million will aid in paying monitoring costs of the state
insurance agencies.
The agreements need the
insurance companies to ensure their insurance files alongside information on deaths
collected by the Social Security Administration. In case a beneficiary cannot
be located, the insurance companies are supposed to hand the unspoken for money
over to the states.
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