Woodland Hills, Calif.-based Health Net Inc., one of the state’s largest health care insurers, has agreed to offer new coverage to 926 customers who were dropped from individual or family policies in the years since 2004.

In a settlement with the California Department of Insurance, Health Net Inc. agreed to pay $14.2 million in billed medical charges, waive $7.2 million in insurance premiums and pay a $3.6 million penalty to the state if a follow-up examination finds that it did not correct all deficiencies.

“While we do not necessarily agree with the California Department of Insurance's allegations, we do believe it is time to move forward and make sure these affected individuals can obtain coverage,” Health Net Chief Executive Jay Gellert said in a statement.

“During the settlement negotiations, Health Net was highly cooperative, and I believe their broad-based changes to underwriting and rescission practices will serve as a model and example to other health insurers. I also commend the state Department of Managed Health Care for helping bring Health Net to the bargaining table,” state Insurance Commissioner Steve Poizner said in a news release.

The case is not singular. No further than July this year, Blue Shield and WellPoint’s Anthem Blue Cross reached deals with the Department of Managed Health Care. As part of the settlement, they offered new coverage to more than 2,200 Californians they dropped and also agreed to pay $13 million in fines.

 Following the incident, shares of the company were down 16 cents at $26.33 in afternoon trade on the New York Stock Exchange.