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MetLife Ordered by State to Refund Customers Over Wrongful Surcharges

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MetLife settles with state over allegations it wrongly assessed auto accident surcharges

By Todd Wallack, Globe Staff

MetLife will pay at least $50,000 in penalties and refund an
undetermined amount of money to customers to settle allegations it
imposed costly surcharges on Massachusetts drivers who were found not at
fault in auto accidents.

State attorney general Martha Coakley said Tuesday that some
customers of Metropolitan Property & Casualty Insurance Company — a
unit of MetLife — who filed accident claims with the company were
improperly penalized even after a state appeals board had ruled they
were not responsible for causing the crashes.

Under Massachusetts law, a driver assessed a surcharge by an
insurance company because they are deemed at-fault in an accident can
appeal the insurer’s decision to the state. If the appeals board vacates
the surcharge, the company is required to halt the extra charges and
refund any penalty money already collected.

MetLife said it is working with the attorney general’s office to make
sure customers who were incorrectly charged surcharges “receive the
appropriate refunds.”

Coakley’s office said it has also started investigating whether other
auto insurance companies in Massachusetts have similarly violated the

State officials said they began looking into the issue after receiving a complaint from a MetLife customer.

“This is another example of an auto insurance rating problem that our
office discovered as a result of a consumer complaint,” Coakley said in
a statement. “While we are troubled that these overcharges occurred, we
are pleased that we were able to stop this unlawful practice and
protect consumers.”

Charles DiPompo, the customer who contacted the attorney general,
said he was hit with a surcharge after he was involved in a fender
bender in 2008. But MetLife kept charging him an extra $30 a month for
about a year after he persuaded the state that he wasn’t to blame for
the accident.

“I felt they weren’t listening to me,” said DiPompo, 64, of
Foxborough. “I felt they were giving me the run-around and not treating
me fairly.”

As part of the settlement, MetLife agreed to an audit that will
determine how many customers were affected, calculate the amount of
restitution owed them, and prevent such overcharges from happening in
the future. The company also agreed to pay the state at least $50,000.

MetLife was the seventh largest auto insurer in the state in 2010,
according to the most recent data available from the Division of
Insurance. The company’s parent, MetLife Inc. of New York, is a major
provider of insurance, annuities and employee benefits programs. It has
about 90 million customers nationwide.

In September, MetLife agreed to pay $395,000 in restitution after wrongfully terminating 2,600 auto policies in Massachusetts.

The state said MetLife auto insurance customers who believe they were
incorrectly assessed accident surcharges should contact the attorney
general’s insurance and financial services division at 888-830-6277.

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