What the lawsuit is about
American Family Insurance has been sued in a class action alleging that certain universal life insurance policies sold to customers between 2015 and 2019 were misrepresented. Plaintiffs claim that the company promised guaranteed minimum cash values and dividends that were not delivered, resulting in significant financial loss.
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Key allegations
Three core allegations drive the suit:
- Misleading marketing: Advertised "guaranteed growth" that was not supported by policy terms.
- Hidden fees: Policyholders were charged higher surrender charges and administrative fees than disclosed.
- Failure to disclose risks: The insurer did not adequately explain the variability of cash value and dividend rates.
Potential impact on policyholders
If the court rules in favor of the plaintiffs, affected policyholders could receive:
- Refunds of overcharged fees.
- Compensation for lost cash value growth.
- Reimbursement for policy surrender costs.
Policyholders should review their contracts and consult an attorney to determine eligibility for recovery.
Timeline of the case
| Event | Year |
|---|---|
| Policy sales period | 2015-2019 |
| Class action filed | 2023 |
| Preliminary hearing | 2024 (scheduled) |
What to do if you own a policy
Policyholders should:
- Check the policy number and the sale date.
- Gather all statements and fee schedules.
- Contact a consumer protection attorney or the American Family legal department.
Industry implications
This lawsuit highlights the need for transparent disclosure in variable universal life products. Insurers may need to revisit marketing claims and fee structures to avoid similar litigation.