States Require Insurance Companies to Locate Beneficiaries

Beneficiaries of unclaimed life insurance policies already have received billions of dollars — and others could be in store for some unexpected cash — the result of state actions forcing companies to locate heirs and pay them the money they are owed. Nearly two dozen states have passed laws requiring companies to search for beneficiaries. Illinois is the latest to consider a version of the legislation. The laws follow years-long audits and multi-state investigations of the top 40 insurance companies that revealed many of them held on to benefits, even when they knew the person insured had died. More than 20 insurance companies settled with states. Some companies are pushing back, against both the investigations and the laws. Life insurance companies owned by Chicago-based Kemper Corp. are trying to block Florida’s law, one of the nation’s strongest, and are fierce opponents of Illinois’ proposal, which was approved by state lawmakers but still needs Gov. Bruce Rauner’s signature to become law. In lawsuits against the Illinois State Treasurer and Florida’s Chief Financial Officer, Kemper’s subsidiaries have argued that under their contracts with policyholders, beneficiaries have to make a claim to receive benefits. Most of the laws are modeled after a version drafted by the National Conference of Insurance Legislators and supported by the American Council of Life Insurers, an industry group whose members include MetLife, Nationwide and Prudential. The council is pushing for all states to adopt this “national standard” by 2017.

Source/more: ABC News

David Wingate is an elder law attorney at the Elder Law Office of David Wingate, LLC. The elder law office services clients with powers of attorneys, living wills, Wills, Trusts, Medicaid and asset protection. The Elder Law office has locations in Frederick and Montgomery Counties, Maryland.