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CA Department of Insurance

USAA shows industry best practice with its use of the Death Master File

News: 2014 Press Release

For Release: February 10, 2014
Media Calls Only: 916-492-3566
USAA shows industry best practice with its use of the Death Master File
Commissioner encourages industry to follow lead of those complying

SACRAMENTO, Calif. - Insurance Commissioner Dave Jones today announced that a recent multistate market conduct exam of USAA shows the insurer has properly used the Death Master File database for over a decade. The fact that USAA complied with the law in its use of the Death Master database counters assertions by insurers who are not complying that the legal requirements for use of the Death Master File were not understood by insurers.

"I commend USAA for being an industry leader in its use of the Death Master File," said Jones. "The findings of this exam validate our position that insurers can comply with the Unfair Claims Settlement Practices Act and that some in fact do."

Jones is one of the commissioners leading a national investigation of life insurers' failure to use the Death Master File to pay benefits to the beneficiaries of life insurance policies. The Death Master File is a database created by the Social Security Administration and rented to life insurance companies, which contains the names of deceased persons in the United States who have social security numbers. Many life insurance companies used the Death Master file to their economic benefit to cut off annuity payments to annuitants but failed to use the Death Master file to determine when life insurance policyholders had died and failed to make payments to their beneficiaries.

The settlement agreements require the life insurers to compare the Death Master File against all of their past and present life insurance policyholders and to pay benefits where there are matches between policyholders and names in the Death Master File.

USAA is the second insurer found in compliance with the law, following multistate market conduct examinations. The other insurer is Massachusetts Mutual. With the inclusion of USAA, 15 insurers representing nearly 60 percent of the market have agreed to use or have used the Death Master File symmetrically in compliance with the requirements of the Unfair Claims Settlement Practices Act.

New Hampshire was the managing lead state on the market conduct exam, which found that it has been and continues to be USAA's policy to use the Death Master File symmetrically across all product lines to ensure the company is identifying deceased life insurance policyholders whose beneficiaries are owed life insurance proceeds.

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Media Notes:

The following is a list of settling and complying companies: Prudential, MetLife, ING, NY Life, John Hancock, Lincoln National, MassMutual, Aegon (Transamerica), AIG, Sammons (Midland National), Nationwide, TIAA, Aviva, Genworth, and USAA.

Link to the USAA report

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The California Department of Insurance, established in 1868, is the largest consumer protection agency in California, regulating the $123 billion insurance marketplace. In 2013 the California Department of Insurance received more than 170,000 calls from consumers and helped recover over $63 million in claims and premiums. Please visit the Department of Insurance web site at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800.927.HELP or 213.897.8921. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.

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