MINNESOTA’S AG NOW CHASES MIDLAND NATIONAL

Minnesota attorney-general Lori Swanson has begun legal action against Midland National Life, alleging that the assurer contravened Minnesota law by selling unsuitable policies to senior citizens. Many had significant financial penalties if the policyholders withdrew cash before 10- to 14-year maturity periods were up. The legal action follows a recently settled deal with Allianz Life, where up to 7,000 customers were compensated. A case is also pending against American Equity Investment Life. Ms Swanson said that the AG office was looking at the sales practices of a dozen other companies. Midland National said that it disputed the claims and that it would fight them in court. Frank Taylor, an attorney representing Midland National, said that “a one-size-fits-all approach to regulating the sale of annuities in this state ... is not appropriate and does not serve the public’s interest”. Minnesota law requires that any company selling long-term policies should have “reasonable grounds for believing that the recommendation is suitable for the customer and must make reasonable inquiries to determine suitability”.