NU Online News Service, June 4, 3:05 p.m. – Nearly 430,000 minority policyholders in Florida will share in an estimated $50 million settlement with two insurance companies charged with unfair underwriting and pricing practices.
The announcement came today from Florida Treasurer and Insurance Commissioner Tom Gallagher. The unfair practices charges include the use of race-based premiums, the Florida Department of Insurance says.
The amount each affected policyholder will receive will vary depending on the face value of the policy, the type of insurance product purchased and when it was issued, says Tami Torres, Florida DOI spokeswoman.
The premiums paid were for industrial policies–or burial policies–that cover funeral expenses when the insured dies, the DOI says.
The settlement follows a market conduct examination initiated by the state of Georgia in conjunction with the Florida and eight other states on behalf of affected policyholders.
The examination began in November 2000 after it was learned that the companies had historically charged African-Americans higher premiums than white customers for similar or identical coverage, the Florida DOI says.
