(Adds details about reserve increase)
By Suzanne Barlyn
Jan 28 (Reuters) - U.S. insurer MetLife Inc will pay a $19.75 million penalty to New York State’s insurance regulator after revealing that it had failed to pay pensions to over 13,000 people, the regulator said on Monday.
The New York-based insurer also agreed to pay $189 million to individuals in New York and elsewhere whom it owes and has already paid $123 million, the New York state Department of Financial Services said.
“MetLife has agreed to take actions, many of which are already in progress, to improve our procedures to better serve our customers,” a MetLife spokeswoman said in a statement.
The settlement follows an examination by the New York regulator.
In December, MetLife paid $1 million to Massachusetts’ financial regulator to resolve an administrative case involving the pension snafu, which goes back to 1992.
Some life insurers, including MetLife, take over corporate pension plans from companies that want to offload them. The insurers then use a group annuity to make regular payments to the retirees who are entitled to benefits under those pensions.
MetLife said in 2017 that it was unable to find potentially thousands of retirees whose pensions it had taken over and had self-reported the problem to regulators. Last February, MetLife said it would increase its reserves by $510 million to cover the obligations.
MetLife has ramped up its efforts to locate the retirees and their beneficiaries, the company has said.
Reporting by Diptendu Lahiri in Bengaluru; Editing by Arun Koyyur and Lisa Shumaker