Genworth Financial Inc. provided updates on two lawsuits wherein plaintiffs claimed violations of their policies.
The U.S. District Court for the Eastern District of Virginia has preliminarily approved a settlement and set the final approval hearing for July 10 in a lawsuit representing long-term care insurance policyholders claiming fraudulent inducement by omission and violation of Pennsylvania's Unfair Trade Practices and Consumer Protection Law. The litigation was filed on behalf of the two named plaintiffs who are Pennsylvania residents.
On March 26, the parties filed a joint motion for leave to amend certain aspects of the settlement, which was approved by the court March 31.
The Indiana Department of Insurance then on April 10 filed a motion seeking to stay the current schedule for class settlement and delay the date of the final approval hearing in light of disruptions caused by COVID-19.
Based on the court's preliminary approval of the settlement, Genworth Financial does not expect the outcome of this matter to have a material adverse impact on its results of operations or financial position. If the court does not approve the final settlement, Genworth Financial intends to continue to vigorously defend the action.
The plaintiffs' original complaint seeking damages in excess of $5 million had also included breach of contract and fraud; the company's motion to dismiss was partly granted to remove breach of contract. Genworth Financial and Genworth Life Insurance Co. were the first named defendants, with the parent dropped as a defendant in an amended complaint.
In another amended complaint, Genworth Life Insurance Co. of New York was added as a defendant and the class was expanded to all 50 states and the District of Columbia.
Separately, Genworth Life and Annuity Insurance Co. was named as a defendant in a putative class-action lawsuit filed in the same Virginia court on April 6. The lawsuit claims that the company subjected policyholders to an unlawful and excessive cost of insurance increase. The plaintiff also alleged that the increase was not applied uniformly to policyholders, and that Genworth Life and Annuity improperly refused to provide reports on illustrative future death benefits and policy values to policyholders.
The complaint asserts claims for breach of contract and injunctive relief and seeks damages in excess of $5 million, restitution, reinstatement of lapsed and/or surrendered policies and equitable relief. Genworth Financial said it intends to vigorously defend itself.