Two days ago, Metropolitan Life Insurance Co. officials said regulatory fines of $20-million for misleading customers were excessive and hinted they might fight attempts to make them pay.
Monday, beleaguered by months of investigations, negative press and plummeting sales, they changed their minds.
At a meeting of the nation's insurance regulators in Denver, MetLife attorneys agreed to the unprecedented $20-million in fines paid to almost every state in the nation.
The fines came after the release of a conclusive investigation detailing how MetLife did little to stop salespeople in its Tampa district sales office and elsewhere from selling high-commission whole life insurance policies they told customers were more lucrative retirement savings plans.
About $12.5-million of the fines will be paid in cash; the rest will be divided by states and allocated to them however individual regulators think fit.
Florida will get a record $4.26-million, including almost $2.7-million in cash and another $1.6-million in other forms of payment. The cash will ultimately wind up in the state's general funds.
How the $1.6-million might be paid has not been decided, but it may come in the form of contributions to a fund for education of insurance agents or consumers, or into a fund for extra refunds to customers.
MetLife officials also agreed to a comprehensive restitution package that offers refunds to 60,000 customers and a sweeping reorganization of its internal ethics and regulatory compliance departments. If all 60,000 customers opt for refunds, it would cost the company $76-million.
MetLife spokesman Charles Sahner tried to put the settlement in a positive light on Monday.
"We still think $20-million is excessive in light of the fact of all we've already done," Sahner said from MetLife's New York headquarters. "But we also know our top priority is making refunds, making sure policyholders are made whole and that no one is financially hurt. We don't want squabbling about punitive fines to hinder that."
As of late Monday, insurance regulators from 21 states had agreed to the settlement.
Jill Chamberlin, spokeswoman for Florida Insurance Commissioner Tom Gallagher's office, said Gallagher was "cautiously optimistic" that other states would sign on today.
Gallagher, who led a multistate task force investigating MetLife, left Denver on Monday afternoon to return to Tallahassee and prepare for an interview on today's Good Morning America show.
At least one regulator, Texas Insurance Commissioner Bob Hunter, had said he would not agree to the settlement because he thought more Texas customers were duped than was indicated in the investigation, and therefore, more fines should be levied.
Because the global settlement is unprecedented, it is unclear what will happen if the rest of the states affected don't sign on, Chamberlin said.
The other states may opt to fine MetLife separately. If they do so, MetLife may choose to try and cancel the settlement.
"We're hopeful all the states will agree to participate," said Sahner, the MetLife spokesman. If they don't, "we'll have to take that one step at a time."