The Unum Regulatory Settlement Agreement: What You Need to Know
Recently, insurance provider Unum reached a regulatory settlement agreement with several state insurance departments over allegations of improperly denying disability claims. The settlement, which includes payments to affected policyholders and changes to Unum`s claims practices, serves as a reminder of the importance of understanding your disability insurance policy and knowing your rights as a policyholder.
Here`s what you need to know about the Unum regulatory settlement agreement:
Background
Unum (formerly known as UnumProvident) is a leading provider of disability insurance in the United States. However, the company has faced numerous allegations of unfairly denying claims, including accusations of bad faith practices and underhanded tactics to avoid paying policyholders.
In 2003, several state insurance departments launched an investigation into Unum`s claims practices, resulting in a multi-state settlement agreement in 2004. However, complaints against the company continued to pile up, leading to further regulatory action in the years that followed.
The Latest Settlement
In February 2021, Unum announced a new regulatory settlement agreement with insurance departments in several states, including California, Florida, Maine, Massachusetts, and Tennessee. The settlement requires Unum to make several changes to its claims process and to pay up to $127 million in restitution to affected policyholders.
Some of the key provisions of the settlement include:
– Changes to Unum`s claims handling procedures, including increased oversight and training for claims personnel.
– Implementation of a process for policyholders to request a new review of their claim if they believe it was improperly denied.
– Establishment of an independent reviewer to assess certain claims denials.
– Payment of up to $127 million in restitution to policyholders whose claims were improperly denied between 2008 and 2020.
– Payment of $6 million to the participating states to cover the costs of the investigation and oversight.
What It Means for Policyholders
If you have a disability insurance policy with Unum, it`s important to understand your rights as a policyholder and to be aware of the changes that will be implemented as part of the settlement. Some key things to keep in mind include:
– You have the right to appeal a claim denial if you believe it was unjustified.
– You may be eligible for restitution if your claim was improperly denied between 2008 and 2020.
– Unum will be making changes to its claims handling procedures to ensure greater transparency and fairness for policyholders.
It`s also worth noting that while the settlement specifically addresses issues with Unum, the broader issue of unfair claims practices is not limited to a single company. As a policyholder, it`s always a good idea to carefully review your disability insurance policy and to seek guidance from an experienced professional if you have any questions or concerns.
In conclusion, the Unum regulatory settlement agreement serves as a reminder of the importance of holding insurance companies accountable for fair claims practices. By understanding your rights as a policyholder and staying informed about developments in the industry, you can help ensure that you receive the benefits you are entitled to when you need them most.
