It's not that people don't want to save for retirement, it's because they can't afford to.
RALEIGH, N.C., Dec. 5 -- The North Carolina Department of Insurance issued the following news release:
Insurance Commissioner Wayne Goodwin has announced a settlement agreement with American Modern Home Insurance Company and its affiliate American Family Home Insurance Company. The settlement agreement includes a monetary penalty in the amount of $260,000, and an attendant corrective action plan that provides for refunds of approximately $1.6 million to North Carolina consumers.
The North Carolina Department of Insurance's Consumer Services Division initiated an investigation of American Modern Home Insurance Company and its affiliate American Family Home Insurance Company, after resolving a September 2011 consumer complaint that indicated questionable or unclear policy features and pricing. As a result of an investigation lasting several months with continued inquiries by the Department, other irregularities were discovered and self-reported by AFHIC and AMHIC. The settlement addressed the following issues:
* AMHIC and AFHIC used an incorrect policy deductible in the process of calculating rates for approximately 26,682 mobile home policies sold to North Carolina consumers from 2008 to 2012. Due to this miscalculation, North Carolina policyholders will be refunded approximately $1.06 million in premiums as part of the corrective action plan.
* AMHIC utilized a waterbed liability rider on approximately 21,684 renter's policies sold to North Carolina consumers from 2007 to 2012, regardless of whether or not the consumers owned a waterbed. Approximately $475,000 in premiums charged for this rider will be refunded to North Carolina consumers as part of the corrective action plan.
* AMHIC failed to follow North Carolina Rate Bureau methodologies for calculating premiums on approximately 4,809 additional renter's policies sold to North Carolina consumers from 2009 to 2011. Due to this miscalculation, approximately $52,149 in premiums will be refunded to North Carolina consumers as part of the corrective action plan.
* AMHIC failed to provide the required "consent to rate" disclosure to 73 North Carolina renter's insurance policyholders who purchased their policies from 2007 to 2012 and were charged premiums above those approved by the North Carolina Department of Insurance. As a result of this error, approximately $7,000 in premiums will be refunded to these consumers as part of the corrective action plan.
Per the N.C. Constitution Article IX, Section 7, the $260,000 monetary penalty is to be placed in the state fund, which is divided equally amongst the state's public school districts.
AMHIC and AFHIC are now beginning the refund process, and affected policyholders will be notified by mail. However, due to the large number of policies and policyholders affected, completion of the corrective action plan is not expected until summer 2013. Current or former AMHIC or AFHIC policyholders seeking more information on refund eligibility, current coverage or other aspects of this matter should contact the companies' customer service department at 800-543-2644.
TNS hc11-121206-JF78-4129904 StaffFurigay