Press Release  Delaware Life Insurance Company to Pay $244,000 to Settle Allegations of Delayed Payments Under Annuity Contracts

Boston — Delaware Life Insurance Company has agreed to pay $244,000 to resolve allegations that it failed to provide payments and forms in a timely and accurate manner for certain annuity contracts, Attorney General Maura Healey announced today.

The AG’s Office filed an assurance of discontinuance in Suffolk Superior Court yesterday alleging that Delaware Life violated Massachusetts consumer protection law when its systems failed to properly administer annuity contracts, resulting in delayed payments and tax forms to policyholders and beneficiaries.

“People should be able to trust their insurance companies to provide accurate, on-time payments, forms, and other important documents,” AG Healey said. “Through this settlement, Delaware Life will compensate affected customers for delays and make improvements to its administrative system to ensure this doesn’t happen to Massachusetts consumers again.”

The Attorney General’s Office began investigating Delaware Life’s administration of its annuity contracts after receiving complaints from Massachusetts customers concerning delays. According to the settlement, problems began when Delaware Life transferred a group of annuity contracts to a third-party administrative platform. After becoming aware of the problems, Delaware Life began taking steps to address associated errors and implement system improvements.

Under the settlement, Delaware Life will pay $214,000 to nearly 2,000 individuals who experienced delays in payments or failed to receive forms required to complete tax returns on time. Delaware Life is also required to report delays in death benefit payments under certain annuity contracts and provide those affected individuals with additional compensation. The company will pay $30,000 to the Commonwealth.

Delaware Life will contact policyholders and beneficiaries who are eligible to receive payments under the settlement. Consumers with questions about the settlement should contact Attorney General Healey’s Insurance & Financial Services Division at 1-888-830-6277. 

This matter was handled by Assistant Attorney General Brook Kellerman, Legal Analyst David Lim, and Deputy Director Arwen Thoman, all of the Attorney General’s Insurance and Financial Services Division.

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