Insurers Needn't Disclose Interest Charges, Calif. Justices Say
Law360 (November 14, 2019, 10:08 PM EST) -- The California Supreme Court handed Northwestern Mutual Life Insurance Co. a win Thursday in a proposed consumer class action challenging the company's practice of charging compound interest on policy loans, ruling that insurers are exempt from disclosing such charges under state law.
Answering a question from the Ninth Circuit in Northwestern Mutual’s dispute with policyholder Sanford Wishnev, the California high court unanimously found that insurance carriers are not subject to a provision of the state’s constitution generally requiring lenders to obtain borrowers’ signed consent before they can charge compound interest on loans.
That restriction was one of several established a century...
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