Sun Life Financial Inc. says it has reached a settlement in principle to resolve a long-running class action tied to individual life insurance policies sold by Metropolitan Life Insurance Company (MetLife) in the 1980s and 1990s.
Announced late Thursday, the proposed deal would see Sun Life provide up to $213.5 million in settlement value to eligible policyholders, subject to court approval. The company expects to record an estimated after-tax charge of approximately $145 million to its Q1 2026 reported net income if the settlement is approved.
The class action concerns the interpretation of policy language in historic MetLife life insurance policies that Sun Life inherited through past Canadian acquisitions. Sun Life emphasized that the matter does not involve any policies or products it has sold under its own brand.
The litigation has been ongoing for years and has been disclosed in Sun Life’s financial reporting, most recently in Note 22G of its 2025 Annual Consolidated Financial Statements.
According to Sun Life, MetLife provided an indemnity relating to these legacy policies. If the settlement receives court approval, Sun Life plans to seek full recourse from MetLife under that indemnity arrangement, effectively attempting to recover the settlement costs.
The settlement and the related notice process for class members remain subject to court approval. If approved, the agreement would bring finality to a long-standing legal dispute and provide certainty for affected policyholders.
As of December 31, 2025, Sun Life reported $1.60 trillion in assets under management and operates across multiple markets worldwide, including Canada, the United States, Europe and Asia-Pacific. The company’s shares trade on the Toronto, New York and Philippine stock exchanges.
