Long-Term Insurance Suit Settled for $15 Million

A class lawsuit filed in 2002 by Eric and Carol Chalgre, residents of Missouri who purchased long-term care insurance policies through Mutual of Omaha, American Heritage Life Insurance Co., and Wakely and Associates Inc., has been settled with the agreement of a $15 million fund.

The suit alleged that the defendants set initial premiums very low but did not tell the policy holders that they planned to raise the premiums substantially over time.

Long-term care insurance is meant to cover costs associated with continuous care of people with chronic, debilitating illnesses such as Alzheimer's disease, diabetes, Parkinson's disease and multiple sclerosis.

The settlement, $11 million of which will be paid by Mutual of Omaha and American Heritage, will cover some 1,669 Missouri residents.

APRIL-20-09: Mutual of Omaha, 2 other insurers, settle long-term care suit [KANSAS CITY: MUTUAL OF OMAHA, 2 OTHER INSURERS SETTLE]