The Metropolitan Property and Casualty Insurance Co. has agreed to pay $395,000 in restitution for wrongfully terminating 2,600 insurance policies in Massachusetts, the state attorney general’s office announced Wednesday.
The company, which also does business as MetLife Auto & Home, allegedly violated a “clean-in-three” rule that bars insurers from refusing to renew policies of drivers who have not had an accident or traffic violation in three years.
Under an agreement filed in Suffolk Superior Court, Met P&C agreed to pay 56 consumers whose policies were terminated and were assigned to the state’s high-risk insurance pool nearly $35,000 in compensation - or $620 each.
The company also agreed to pay another $310,000 -- or $120 each -- to nearly 2,600 other policyholders who were not renewed, but found other insurance companies willing to cover them, plus $50,000 to the state. The company also agreed to comply with the rules going forward.
Met P&C had 5.1 percent of the auto insurance market in 2010, making it the seventh largest insurer in the state, according to the Division of Insurance.
The parent company, MetLife Inc. of New York, is a major provider of insurance, annuities and employee benefits programs with 90 million customers.