AIG Target Of Class Action Lawsuit Over Structured Settlement Program

Hagens Berman law firm has filed a class-action lawsuit against the nation's largest insurance company -- American International Group, known as AIG and American General Life Insurance Company, which is a part of AIG.

The lawsuit claims the companies defrauded annuitants and injury victims of their rightfully deserved claims. The suit says through their structured settlements, AIG took 4 percent from the cash portion and secretly used it to fund commissions to their own defense brokers.

According to the lawsuit, clients agreed to the 4 percent deduction, thinking it would be used to fund future annuity payments, but instead AIG kept the money for themselves.

The suit claims AIG used plaintiff's funds to decrease their defense expenses and reduce the amount of money they promised to pay clients. The lawsuit seeks more than $5 million and involves more than 100 plaintiffs, of which fewer than one-third are citizens of Massachusetts, where the case was filed in federal court.

We will continue to follow this story and give you the latest updates at they become available.