State receives $1M from nationwide AIG settlement

Missouri public schools are receiving more than $1 million as part of a national settlement with New York City-based insurance company American International Group Inc.

Since the beginning of 2009, market investigations into insurance companies have generated $8.7 million for the state, which goes toward consumer refunds, general revenue and the Missouri State School Fund, according to a June 18 news release from the Missouri Department of Insurance.

Following a joint investigation starting in 2008 by every state insurance department nationwide, AIG has agreed to pay $146 million, stemming from allegations that the company, under previous leadership, underreported its workers' compensation insurance revenues by more than $2 billion.

"This underreporting of premium volume allowed AIG to pay less in taxes and gain a financial advantage over its competitors," state Department of Insurance Director John Huff said in the release. "Missouri employers count on competitive workers' comp insurance markets, and our laws provide consequences for companies that attempt to undermine competition."

As part of the settlement, the states will continue to monitor AIG with the stipulation that the company could pay an additional $150 million if it fails to accurately report its workers' comp insurance revenues.[[In-content Ad]]