Genworth Accused of Wrongly Terminating Policies

A California state court class action lawsuit has accused Genworth Life and Annuity Insurance Co. of terminating hundreds of policies without lawful reminders and allegedly disregarding the grace period provisions required by state law.

In a complaint filed Feb. 28 by attorneys of Nicholas & Tomasevic, in San Diego, California; Singleton Schreiber in Sacramento, California; and Winters & Associates in La Mesa, California, the plaintiff, James Fox, on behalf of a others similarly situated, allege that Genworth has knowingly and systemically terminated the policies held by customers since 2013.

The lawsuit, filed in California Superior Court for the County of Sacramento, raised California Insurance Code Sections 10113.71 and 10113.72, which require life insurers to comply with a 60-day grace period and provide proper notice before terminating a policy for nonpayment of premiums.

“Since Jan. 1, 2013, Genworth has become aware of its failures and has failed to take the appropriate corrective action,” the complaint said. “Instead, Genworth appears to have doubled down and made the decision to ignore the law, ignore court rulings, and deal with the occasional complaint without regard to its obligation to apply these rules properly and completely to all of its varied life insurance products utilized in this state.”

The lawsuit claims the affected customers have been forced into unnecessary reinstatements, and in many instances, they have “lost all reasonable access to any insurance at all” as a result of Genworth’s actions. Plaintiffs are still allegedly paying inflated premiums and the reinstatements diminish the value of their policies, according to the complaint.