Ohio federal District Judge Matthew W. McFarland preliminarily approved a $28 million proposed settlement with the named plaintiff and a proposed settlement class involving nearly 12,000 policyholders of U.S. Financial Life Insurance Company. Plaintiff and class members alleged the insurer unjustifiably increased the cost of insurance (COI) charges on certain universal life products in 2015. Judge McFarland also preliminarily certified the proposed settlement class and preliminarily appointed Beasley Allen lawyers W. Daniel “Dee” Miles, III, head of the firm’s Consumer Fraud Section, Rachel Minder and Paul Evans as lead class counsel. The settlement is subject to final approval.
“We are proud to represent these policyholders and pleased with the relief this proposed settlement offers them,” Miles said. “The case was a hard-fought battle with worthy advocates opposing our class, but the case resolved with very good relief and benefits to the class members. We look forward to the Court granting final approval to the class in August.”
If approved, the settlement agreement provides the proposed class members with several valuable benefits.
- USFL will create a common settlement fund of $11.5 million. This fund will be distributed to settlement class members, pro-rata, based on the portion of COI charged to each class policy after the 2015 COI rate increases. No settlement class member will receive less than $100.
- The proposed settlement provides that USFL agrees not to impose any COI rate increases on class members’ policies for five years.
- USFL agrees not to seek to void, rescind, cancel, have declared void, or otherwise deny coverage or death claims submitted by settlement class members based on any alleged lack of insurable interest or misrepresentations made in connection with the original application process.
- For class members who have not already availed themselves of this right in 2021, USFL agrees to provide in-force illustrations to class members upon request and at no cost to the settlement class member until October 1, 2021.
This total value comprises the $11.5 million Common Settlement Fund and the valuation of the other relief detailed above, reasonably valued between $14,643,000 and $17,571,600, which is supported by the formal and informal discovery well as valuations by Plaintiff’s experts.
The case is No. 1:17-cv-417 in the U.S. District Court for the Southern District of Ohio.