Thursday, March 3, 2011

Washington to get $500,000 from AIG settlement

Washington state will receive $500,000 as part of a multi-state settlement with American International Group, Inc., better known as AIG.

The settlement includes a $100 million fine, divided among the 50 states and the District of Columbia. The company will also pay roughly $46.5 million in additional taxes and assessments. It also agreed to follow a compliance plan designed to fix the problems uncovered in a multi-state probe.

At issue was the company’s pattern of failing to comply with laws related to their handling of workers’ compensation programs. An examination team found a pattern of widespread violations, including using rating plans that hadn’t been filed with regulators and false reporting of the insurance premiums from workers compensation.

Although Washington state provides workers compensation coverage through a state-run program, it became part of the process because it was uncertain if the premium re-allocation would affect the state.

The $500,000 settlement does not go to the insurance commissioner’s office. The money will be deposited in the state’s general fund to pay for other state services.