Class Action Against The Hartford Negotiates $72.5M Settlement

Preliminary approval has been granted by the U.S. District Court for the District of Connecticut of a $72.5 million dollar settlement between The Hartford Financial Services Group, Inc. and a class of more that 21,000 members who had previously settled personal injury and workers' compensation claims with The Hartford's property and casualty company.

The class action suit alleged that when The Hartford settled personal injury and workers' compensation claims asserted against its insureds, it often paid some or all of the settlement amount with a structured settlement (paid over time) rather than in one lump sum payment. Those payments over time are commonly funded with an annuity issued by a life insurance company.

The suit also claims that The Hartford, in funding the class members' structured settlements, purchased the annuity from its own life insurance company, and in the process, and without disclosure to the injury victim, retained 15 percent of the value of the settlement for itself. The plaintiffs assert claims under The Racketeer Influenced Corrupt Organization Act (RICO) and for fraud.

The settlement will provide each of the class members with approximately $3,300, before payment of fees and expenses.

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Published on Jun-11-10