Trans World Assurance Corrects the Record:
In response to a recent press release by the California Department of Insurance, Trans World Assurance Company issues the following statement:
Compliance With New Military Regulation Was Prompt and Voluntary
“The recent press release by the California Department of Insurance regarding our company is inaccurate and misrepresents the result of an agreement that was reached between Trans World Assurance Company and the CA Department of Insurance. Trans World complied promptly with California’s new Military Insurance Sales Regulation; we voluntarily adjusted our policies, created a new life insurance product, and made refunds to all consumers that were affected by the legislation, prior to any enforcement. Trans World did this even though we believed the regulations to be unfair to those serving in the military—treating them differently than their civilian counterparts—and we felt that the changes could be harmful to those military individuals."
“The Military Insurance Sales Regulation adopted by various state insurance departments, including California, limits the types of policies that may be sold to members of the military. The same limitations do not apply to civilians. We do not think this is right."
“We have disputed whether the Military Insurance Sales Regulation is applicable to FDB. However, we voluntarily modified our FDB policies to comply with the Regulation, and developed a new universal life product. On December 21, 2010, the California Insurance Commissioner issued a press release about the recent settlement between Trans World and the California Department of Insurance. Unfortunately, the release is not accurate in material respects, and wrongly suggests that Trans World sold policies that took advantage of service members. That simply is not true. The automatic payment provision (where insurance premiums were automatically deducted from the accumulation fund part of the policy) protected the valuable insurance policies of many policyholders as they transitioned from the service into civilian life. However, Trans World voluntarily modified our procedures in all states—including California—by deleting the automatic payment provisions and modifying the interest computations of our policies. We advised the California Department of Insurance of our actions before it initiated its administrative proceedings. Long before the settlement, in which Trans World specifically did not admit to any wrongdoing, all of our policies were modified and all service members were reimbursed, in full compliance with the new Regulation.
“Trans World Assurance Company has provided the members of our military with safe, top-performing life insurance products for over 50 years. We have tens of thousands of satisfied policyholders who can attest to the value of our products and our commitment to honoring the trust they place in us. Trans World was among the first underwriters and continues to underwrite Servicemembers’ Group Life Insurance (SGLI). In short, Trans World supports the men and women who serve our country and believes that they should have the same rights as their civilian counterparts to consider and purchase financial products.”