Prudential Financial has agreed to pay $100 million to settle charges from the Federal Trade Commission (FTC), which said the company misled people about health insurance coverage through its now-closed Assurance IQ unit.
The FTC filed the case on Wednesday in a federal court in Seattle, accusing Assurance of giving people the wrong idea about what kind of healthcare plans they were buying.
Assurance, a company Prudential bought in 2019 for $2.35 billion, was supposed to help people find affordable insurance online and by phone.
But according to the FTC, many consumers were led to believe the plans offered full health benefits like those required under the Affordable Care Act (ACA). According to Reuters, in reality, the plans often had limited coverage and left people with large medical bills.
"Assurance told people their plans would lower their costs, but didn't clearly explain that important things weren't covered," said the FTC. "This left many customers stuck with high bills they didn't expect."
Assurance did not admit to doing anything wrong, but agreed to the settlement. Prudential shut the company down in early 2024, after it had taken over $2 billion in losses related to the business.
The U.S. Federal Trade Commission reached a $100 million settlement with Prudential Financial to resolve claims a former unit misled consumers into buying healthcare plans that did not provide the coverage it promised. https://t.co/G8t2N3lDag
— Reuters Legal (@ReutersLegal) August 6, 2025
FTC Hits Prudential With $100M Fine for Deceptive Healthcare Ads
In a statement, Prudential said it was glad to resolve the issue and move forward. "We take compliance seriously and are focused on doing business the right way to benefit our customers," the company said.
The $100 million payout was already included in Prudential's financial statements, according to the firm.
Assurance started in 2016 in Bellevue, Washington, a suburb of Seattle. Prudential bought it three years later, hoping its direct-to-consumer model would reach more people needing health insurance—especially the estimated 17 million Americans who lacked coverage.
However, the business didn't go as planned. In the years that followed, Prudential recorded a total of $2.14 billion in losses tied to Assurance before deciding to shut it down, FutBull said.
This settlement is part of the FTC's ongoing effort to hold companies accountable for misleading marketing practices, especially when it comes to healthcare.
The court case is known as FTC v. Assurance IQ LLC, filed in the U.S. District Court for the Western District of Washington (Case No. 25-01485).
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