State announces settlement over insurer handling of PTSD claims

Vermont Department of Financial Regulation Commissioner Michael S. Pieciak announced a $100,000 settlement with Acadia Insurance Co. to resolve allegations over the insurer’s improper handling of first responder claims for post-traumatic stress disorder.

The department said W.R. Berkley Corp., Acadia’s third-party administrator, engaged in unfair claim settlement practices and violated the state’s Insurance Trades Practices Act “in a vast majority of the claims it handled in Vermont involving PTSD” between 2015 and 2019.

W.R. Berkley Corp., operating as BerkleyNet, refused to pay claims without conducting a reasonable investigation or engaging in a good faith settlement attempt, the department said.

“In one of the most egregious examples, BerkleyNet mailed a request to a first responder for information necessary to process the workers compensation claim and denied the claim on the very same day,” the department said. “These aggressive claims adjustment and settlement practices deterred first responders who may have been experiencing PTSD due to work-related stress from pursuing claims.”

Acadia agreed to pay an $85,000 administrative penalty and contribute $15,000 to the Vermont Financial Services Education and Victim Restitution Special Fund.

WorkCompCentral is a sister publication of Business Insurance. More stories here.