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DFS Superintendent Adrienne A Harris Secures $13.9 Million Settlement with National Union Fire Insurance Company of Pittsburgh

DFS Superintendent Adrienne A Harris Secures $13.9 Million Settlement with National Union Fire Insurance Company of Pittsburgh

Company Ordered to Return $8.3 Million in Restitution to Policyholders

Superintendent of Financial Services Adrienne A. Harris announced today that National Union Fire Insurance Company of Pittsburgh (NUFIC) will pay $5.6 million in penalties and more than $8.3 million in restitution to policyholders pursuant to a Consent Order entered into with the New York State Department of Financial Services (DFS). The Consent Order addresses NUFIC’s issuance of blanket accident and health insurance policies that failed to satisfy minimum loss ratio standards and failed to address the inadequate performance of these blanket policies. These policies predominantly affected institutions of higher education, childcare providers, schools, and day camps, which were overcharged for premiums and were issued benefits that were not designed to diagnose or treat intercollegiate sports injuries. 

“NUFIC’s failure to address significant issues with these policies caused schools and childcare organizations to overpay for insurance,” said Superintendent Harris. “I am proud of the team at DFS for ensuring that these critical institutions, responsible for teaching and taking care of our children, are returned the money that is rightfully theirs.”

In 2021, the Department conducted an investigation into NUFIC’s Blanket Accident Insurance and found that policies issued to certain affected groups between 2016 and 2021 chronically failed to meet minimum loss ratio standards. In addition, NUFIC’s policy for intercollegiate sports injury coverage provided benefits on an indemnity basis rather than an expense incurred basis, in violation of Insurance Law Section 3240.

NUFIC failed to take adequate remedial action to address the inadequate performance of its blanket accident and health insurance policies issued in New York State, and this resulted in the affected groups paying excessive insurance premiums for coverage that did not bear a reasonable relationship to the benefits provided under the policies. 

A copy of the consent order with NUFIC can be found on the DFS website.

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