Sears Nears Settlement in Insurance Dispute

A tentative settlement has been reached in a federal lawsuit filed by retirees who said Sears, Roebuck & Co. unfairly cut the value of their life insurance policies, a lawyer said.

Peter N. Wasylyk, an attorney for the retirees, declined to discuss details. Sears said only that the agreement still had to be approved by a U.S. district judge.

In 1997, 38 retired employees sued the store chain, seeking to get the full value of their life insurance policies restored.

Sears, based in Hoffman Estates, Ill., said at the time that workers who retired after Jan. 1, 1978, would see the value of their company-paid life insurance plans drop to $5,000 over 10 years, regardless of the policies’ previous values.

Sears said the decision would affect 84,000 people; the plaintiffs said the number is 100,000.

In the lawsuit, the lead plaintiff, Marie A. George, a former Sears worker from Warwick, R.I., said the value of her life insurance policy was trimmed by $11,800.