American General Settles Racial Bias Suit

The proposed resolution will settle class action claims and regulatory issues relating to the pricing and sale of industrial life insurance policies. The company said the charge will have no material impact on its financial condition and overall business operations.

The proposed settlement, expected before the end of the year, is subject to final court approval. An inquiry by the Florida Department of Insurance led to American General’s discovery that certain industrial life policies written in the mid-1900s were priced in part on the policyholder’s race.

American General said it stopped collecting differential premiums immediately upon the discovery and entered into talks with the Florida Department of Insurance and plaintiffs’ attorneys to resolve the issue.