Did Hartford Defraud Structured Settlement Plaintiffs? $72.5 Million Settlement Suggests It is So

This is an excellent example of the extent to which an insurance company will go to try to prevent a personal injury plaintiff from receiving full compensation for the injuries that he/she suffered in an accident.

A 72.5 million dollar settlement has been reached (and approved by a federal judge) between attorneys representing 21,000 people nationwide and attorneys for The Hartford Financial Services Group Inc. which allegedly engaged in fraud in settling their injury claims.

Apparently, The Hartford engaged in a process of fraudulently deducting 15 percent of the present value of cases settled by means of structured settlement, for what the company termed "undisclosed annuity costs".

The plaintiff’s attorney called The Hartford’s conduct "corporate fraud"; The Hartford claims that litigants received the amounts that settlements required and that they are settling to avoid an uncertain verdict and future litigation costs. The settlement does not require Hartford to admit fraud.

In case you don’t know, structured settlements are cases that are settled at present value, with payments made over time, at certain intervals, funded by an annuity purchases for the present settlement value. In some instances, this is preferred over receiving an immediate lump sum settlement. The 21,000 class action claimants were due payments on settlements as far back as 1997 for automobile accidents and workers compensation claims. As a result of the class action settlement, victims will receive an average additional payment of $3,300.

The lawsuit alledged that The Hartford had its own property and casualty companies purchase the annuities from its life insurance company, which set up and funded the annuity; the life company then kicked back 15% to the property and casualty companies. Pretty slick way to screw needy plaintiffs out of 15% of their settlements, isn’t it? The problem is it is an illegal violation of federal racketeering laws.

This adds a whole new "d" to the insurance companies typical claims and lawsuit behavior known as "delay, deny, defend". We can now add a fourth "d" for "defraud". The settlement, after a five year legal battle (obviously one where the plaintiff’s attorney, David Golub, kicked The Hartford’s behind) is expected to achieve final resolution in September. Lawsuit Financial, the pro-justice lawsuit funding company, congratulates the victors, both attorneys and clients.

Mark Bello has thirty-three years experience as a trial lawyer and twelve years as an underwriter and situational analyst in the lawsuit funding industry. He is the owner and founder of Lawsuit Financial Corporation which helps provide cash flow solutions and consulting when necessities of life funding is needed during litigation. Bello is a Justice Pac member of the American Association for Justice, Sustaining and Justice Pac member of the Michigan Association for Justice, Business Associate of the Florida, Tennessee, and Colorado Associations for Justice, a member of the American Bar Association, the State Bar of Michigan and the Injury Board.