Principal Life Insurance Company is a nationwide provider of life insurance and annuities products, with the senior citizen market comprising a large share of its business. In the past, the company has also sold annuity products as Principal Mutual Life Insurance Company. In 2000, Principal Life Insurance settled a class action suit involving approximately 960,000 life insurance and annuity holders. An Iowa district court approved the $374 million settlement in early 2001.
The class action claimed that Principal Life Insurance sales agents deceived the class members into purchasing life insurance and annuity products through the use of false and misleading policy illustrations, marketing materials, and sales presentations. The plaintiffs alleged that Principal Life Insurance made marketing statements and presented sales illustrations that depended on deceptive actuarial assumptions and undisclosed material facts. According to the plaintiffs, Principal sales agents fraudulently concealed the presently known fact that the assumptions upon which the performance of the “vanishing premium” policies were based could not be supported by Principal’s current experience. The plaintiffs also claimed that Principal knew the dividend, interest, and investment return assumptions essential to its sales illustrations could not be maintained, and indeed, their projections did not even indicate that they could be maintained. Nonetheless, the plaintiffs argued that the sales personnel used these illustrations to induce the class members to purchase the life insurance and annuity products.
Other misleading tactics allegedly used by Principal Life Insurance sales agents included: improper “churning” of life insurance policies and annuities; overstating the financial performance of cash value policies and annuities; selling insurance as an investment product; and targeting senior citizens for annuity purchases. Evans Law Firm, Inc. was not involved in this case but will investigate annuities sold by Principal Life Insurance Company.
If you or a loved one has purchased an annuity from Principal Life Insurance Company or Principal Financial Group, please contact Evans Law Firm, Inc. today for a free and confidential evaluation of your rights. We can be reached by email at firstname.lastname@example.org, or by telephone at (888) 503-8267 or (415) 441-8669.