Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: WEDNESDAY, March 9, 1994                   TAG: 9403090087
SECTION: BUSINESS                    PAGE: B7   EDITION: METRO 
SOURCE: Associated Press
DATELINE:                                 LENGTH: Medium

MET LIFE TO PAY $20 MILLION IN FINES

NEW YORK - Metropolitan Life Insurance Co. agreed to pay $20 million in fines to settle charges with state insurance regulators that it had deceived thousands of customers, a spokesman said Tuesday.

The settlement, which also involves up to $76 million in restitution to as many as 60,000 customers, was reached with the members of the National Association of Insurance Commissioners, company spokesman Charles Sahner said.

The settlement has been endorsed by insurance commissioners of 24 states.

The regulators charge that New York-based Met Life, the nation's largest life insurer, took no action as its agents misled thousands of customers into buying nonrefundable policies.

The Met Life agents were accused of misrepresenting life insurance plans as retirement plans, the commissioners said. Retirement plans are fully refundable; life insurance policies are not.

"What they did was totally unacceptable, a horrendous act," Florida Insurance Commissioner Tom Gallagher said.

Sahner said the company thinks the $76 million will be the maximum it will pay based on its experience with settling claims from disgruntled customers so far. The company had proposed the $76 million figure previously.

Jill Chamberlin, spokeswoman for the Florida Department of Insurance, said the number could go higher if more policyholders surface and prove they were defrauded by the company. Sahner declined to discuss what Met Life would do if more than 60,000 claims were submitted.

The Florida commissioner has played a major role in the case, because one of the first cases of improper sales activities was discovered in Met Life's Tampa, Fla., office. Several executives at that office eventually were fired.

Chamberlin said commissioners in the 24 states, who represent 70 percent of the affected customers, have signed the agreement and others are considering it. The fine will be divided among the states.

Met Life is supposed to contact the affected customers soon to inform them of the restitution program, she said. If customers are not contacted within several weeks, she said, they should contact their state insurance commissioner for details.