A Houston based law firm has filed suit against Transamerica Life Insurance Company for “massively increasing plaintiffs’ premiums and falsely stating that the increase was permitted by the policy terms.”  According to a press release dated May 7, 2016, the firm of Emerson Scott, LLP announced that it had filed suit in United States District Court for the Central District of California “on behalf of a California and a nationwide class of persons with Transamerica universal life insurance policies who had sudden increases in their monthly deductions withdrawn from accumulation accounts that increased by 38%.”

The suit alleges that “Transamerica’s real reason for the premium increase was to subsidize its cost of meeting its interest guarantee, to recoup past losses on the policies and on its investment portfolio, and to make the policies more profitable by inducing policy terminations by those policyholders who could not afford the increase.”  The previous two lawsuits against Transamerica shared similar language.

The suit seeks “damages and equitable relief to” those affected by the cost increases.

As with earlier lawsuits, ITM Twenty First will be tracking the case.

 

By |2016-05-09T10:08:35+00:00May 9th, 2016|Categories: Current Assumption Universal Life, General Interest, News, Policy Management|2 Comments

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2 Comments

  1. Leonard H Goodman May 9, 2016 at 10:26 am - Reply

    It would appear that lack of integrity within this life insurance industry know no bounds!

  2. Michael Brohawn, CFP, CLU May 10, 2016 at 9:42 am - Reply

    Leonard: We are in an amazing period with negative interest rates and higher regulatory requirements. Unfortunately, I am not seeing an end in sight. As one who manages life insurance policies for a living, this has been a rough time.

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