|
Prudential plan under fire
|
 |
September 20, 1996: 10:16 a.m. ET
Seven states decide to oppose insurer's proposed $35 million settlement
|
NEW YORK (CNNfn) -- Seven states have decided to fight Prudential Insurance Co.'s efforts to resolve a dispute over deceptive sales practices through a class-action settlement of lawsuits, a published report said Friday.
Prudential wants to settle a band of lawsuits alleging that sales representatives had mislead policyholders through a practice known as "churning," or persuading existing policyholders to purchase more-expensive coverage that deflated the cash value of older policies. Up to now, a settlement appeared to be likely. But, according to the Wall Street Journal, Florida, Massachusetts, Texas and four other states have decided to oppose a class-action agreement.
The states argue that a national settlement will not properly compensate their residents who purchased the Prudential policies.
A Prudential spokesman declined to comment on the settlement talks.
Massachusetts Attorney General Scott Harshbarger told the newspaper that "it has become obvious… (that Prudential) does not want to do what it right for policyholders."
While seven states oppose a class-action settlement, 43 states and the District of Columbia have already agreed to a proposed $35 million remediation plan.
|
|
|
|
|
 |
|
