Life Insurance Industry Update: Beneficiary Location Legislation Remains at the Forefront of Legislative Activity
June 2, 2014
June 2, 2014
Since the adoption of the National Conference of Insurance Legislators (NCOIL) Model Unclaimed Life Insurance Benefi ts Act, the life insurance industry has seen significant legislative activity as several states have introduced and passed similar legislation providing unclaimed property policies and requirements for insurers.
In 2014 alone, nine additional states have introduced a version of the NCOIL Model Unclaimed Life Insurance Benefi ts Act—Pennsylvania, Indiana, Oklahoma, Mississippi, Georgia, Tennessee, Iowa, Rhode Island and Louisiana. Although legislation varies from state to state, the underlying theme of each bill is routine use of the Death Master File to identify deceased policyholders and proactively seek out beneficiaries when benefits are due.
We reiterate the importance for life insurers to assess their business practices and strongly advise insurers to develop strategies and outreach programs to fulfi ll their business obligations and comply with the legislation set forth by each individual state. Failing to do so can lead to increased risk of an unclaimed property audit—as the industry has widely experienced over the last year.
A complete listing of all pending legislation since January 1, 2014 is provided for your reference below.
|State Name||Bill No.||Date Introduced||Date Passed||DMF Comparison Basis||Effective Date|
|Pennsylvania||HB 1937||1/6/2014||Pending||Quarterly||60 Days from Passage|
|Indiana||SB 220||1/9/2014||3/25/14||Semi-Annual||July 1, 2014|
|Rhode Island||HB 7031||1/10/2014||Pending||Semi-Annual||Upon Passage|
|Oklahoma||HB 3287||1/21/2014||Pending||Semi-Annual||November 1, 2015|
|Mississippi||HB 2796||1/22/2014||3/24/14||Semi-Annual||July 1, 2015|
|Georgia||HB 920||2/4/2014||Pending||Semi-Annual||January 1, 2015|
|Tennessee||HB 2427, SB 2516||2/4/2014||Pending||Semi-Annual||July 1, 2015|
|Iowa||HB 2333||2/19/2014||Pending||Semi-Annual||July 1, 2015|
|Louisiana||HB 411||2/26/2014||Pending||Semi-Annual||Not Provided|
If you haven’t already, it’s imperative to develop a strategy to successfully locate and communicate with beneficiaries, comply with legislation, and mitigate the associated risks of noncompliance.