American International Group, Inc. (NYSE: AIG) announced today that AIG’s life insurance companies resolved multi-state examinations relating to the handling of unclaimed property and the use of the Social Security Administration’s Death Master File (SSDMF) to identify death claims that have not been submitted to the company in the normal course of business. AIG had previously disclosed that its life insurance companies had received regulatory inquiries, including a multi-state unclaimed property audit and related market conduct examination.
The company will pay an $11 million regulatory assessment to the various state insurance departments to defray costs of the examination and monitoring. In addition to reserving for the regulatory assessment, AIG will increase its estimated reserves for policy holder benefit reserve death claims relating to these audits by $55 million in the third quarter for interest and expected acceleration of benefit payments under the settlement, including early payment of policy proceeds under certain older industrial life policies.
AIG is now taking enhanced measures to, among other things, routinely match policyholder records with the SSDMF to determine if its insureds, annuitants, or retained account holders have died and locate beneficiaries when a claim is payable. This puts AIG among the industry leaders in ensuring that beneficiaries will receive insurance proceeds.
In 2011, prior to receiving any regulatory inquiries, AIG began a diligent review of its policyholder records, including matching records against the SSDMF to identify polices where the insured may be deceased but no claim had been submitted to the Company. To date, as a result of this effort, AIG has paid more than $100 million to more than 22,000 beneficiaries.
American International Group, Inc. (AIG) is a leading international insurance organization serving customers in more than 130 countries. AIG companies serve commercial, institutional, and individual customers through one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies are leading providers of life insurance and retirement services in the United States. AIG common stock is listed on the New York Stock Exchange and the Tokyo Stock Exchange.