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| Public Act 099-0893
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| HB4633 Enrolled | LRB099 18214 JLS 44479 b |
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AN ACT concerning business.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 1. Short title. This Act may be cited as the |
Unclaimed Life Insurance Benefits Act.
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Section 5. Purpose. This Act shall require recognition of |
the Uniform Disposition of Unclaimed Property Act and require |
the complete and proper disclosure, transparency, and |
accountability relating to any method of payment for life |
insurance, annuity, or retained asset agreement death |
benefits.
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Section 10. Definitions. As used in this Act: |
"Annuity contract" does not include an annuity contract |
used to fund an employment-based retirement plan or program |
where (1) the insurer does not perform the record keeping |
services or (2) the insurer is not committed by the terms of |
the annuity contract to pay death benefits to the beneficiaries |
of specific plan participants. |
"Date of death" means the date on which an insured, annuity |
owner, or retained asset account holder died. |
"Date of death notice" means the date the insurer first has |
notice of the date of death of an insured, annuity owner, or |
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retained asset account holder. "Date of death notice" includes, |
but is not limited to, the date the insurer received |
information or gained knowledge of a Death Master File match or |
any other source or record maintained or located in insurer |
records of the death of an insured, annuity owner, or retained |
asset account holder. |
"Death Master File" means the United States Social Security |
Administration's Death Master File or any other database or |
service that is at least as comprehensive as the United States |
Social Security Administration's Death Master File for |
determining that a person has reportedly died. |
"Death Master File match" means a match of the social |
security number or the name and date of birth of an insured, |
annuity owner, or retained asset account holder resulting from |
a search of the Death Master File. |
"Department" means the Department of Insurance. |
"Lost policy finder" means a service made available by the |
Department on its website or otherwise developed by the |
Department to assist consumers with locating unclaimed life |
insurance benefits. |
"Policy" means any policy or certificate of life insurance |
that provides a death benefit. "Policy" does not include any |
policy or certificate of credit life or accidental death |
insurance or health coverages, including, but not limited to, |
disability and long-term care arising from the reported death |
of a person insured under the coverage, or any policy issued to |
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a group master policyholder for which the insurer does not |
provide record keeping services. |
"Record keeping services" means services provided under |
circumstances in which the insurer has agreed with a group |
policy or annuity contract customer to be responsible for |
obtaining, maintaining, and administering its own or its |
agents' systems information about each individual insured |
under an insured's group insurance contract, or a line of |
coverage thereunder, including, but not limited to, the |
following: (1) social security number or name and date of |
birth, (2) beneficiary designation information, (3) coverage |
eligibility, (4) benefit amount, and (5) premium payment |
status. |
"Retained asset account" means any mechanism whereby the |
settlement of proceeds payable under a policy or annuity |
contract is accomplished by the insurer or an entity acting on |
behalf of the insurer depositing the proceeds into an account |
with check or draft writing privileges, where those proceeds |
are retained by the insurer or its agent pursuant to a |
supplementary contract not involving annuity benefits other |
than death benefits.
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Section 15. Insurer conduct. |
(a) An insurer shall initially perform a comparison of its |
insureds', annuitants', and retained asset account holders' |
in-force policies, annuity contracts, and retained asset |
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accounts by using the full Death Master File. The initial |
comparison shall be completed on or before December 31, 2017, |
unless extended by the Department pursuant to administrative |
rule. Thereafter, an insurer shall perform a comparison on at |
least a semi-annual basis using the Death Master File update |
files for comparisons to identify potential matches of its |
insureds, annuitants, and retained asset account holders. In |
the event that one of the insurer's lines of business conducts |
a search for matches of its insureds, annuitants, and retained |
asset account holders against the Death Master File at |
intervals more frequently than semi-annually, then all lines of |
the insurer's business shall conduct searches for matches |
against the Death Master File with the same frequency. |
An insured, an annuitant, or a retained asset account |
holder is presumed dead if the date of his or her death is |
indicated by the comparison required in this subsection (a), |
unless the insurer has competent and substantial evidence that |
the person is living, including, but not limited to, a contact |
made by the insurer with the person or his or her legal |
representative. |
For those potential matches identified as a result of a |
Death Master File match, the insurer shall within 120 days |
after the date of death notice, if the insurer has not been |
contacted by a beneficiary, determine whether benefits are due |
in accordance with the applicable policy or contract and, if |
benefits are due in accordance with the applicable policy or |
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contract: |
(1) use good faith efforts, which shall be documented |
by the insurer, to locate the beneficiary or beneficiaries; |
the Department shall establish by administrative rule |
minimum standards for what constitutes good faith efforts |
to locate a beneficiary, which shall include: (A) searching |
insurer records; (B) the appropriate use of First Class |
United States mail, e-mail addresses, and telephone calls; |
and (C) reasonable efforts by insurers to obtain updated |
contact information for the beneficiary or beneficiaries; |
good faith efforts shall not include additional attempts to |
contact the beneficiary at an address already confirmed not |
to be current; and |
(2) provide the appropriate claims forms or |
instructions to the beneficiary or beneficiaries to make a |
claim, including the need to provide an official death |
certificate if applicable under the policy or annuity |
contract. |
(b) Insurers shall implement procedures to account for the |
following when conducting searches of the Death Master File: |
(1) common nicknames, initials used in lieu of a first |
or middle name, use of a middle name, compound first and |
middle names, and interchanged first and middle names; |
(2) compound last names, maiden or married names, and |
hyphens, blank spaces, or apostrophes in last names; |
(3) transposition of the "month" and "date" portions of |
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the date of birth; and |
(4) incomplete social security numbers. |
(c) To the extent permitted by law, an insurer may disclose |
the minimum necessary personal information about the insured, |
annuity owner, retained asset account holder, or beneficiary to |
a person whom the insurer reasonably believes may be able to |
assist the insurer with locating the beneficiary or a person |
otherwise entitled to payment of the claims proceeds. |
(d) An insurer or its service provider shall not charge any |
beneficiary or other authorized representative for any fees or |
costs associated with a Death Master File search or |
verification of a Death Master File match conducted pursuant to |
this Act. |
(e) The benefits from a policy, annuity contract, or a |
retained asset account, plus any applicable accrued interest, |
shall first be payable to the designated beneficiaries or |
owners and, in the event the beneficiaries or owners cannot be |
found, shall be reported and delivered to the State Treasurer |
pursuant to the Uniform Disposition of Unclaimed Property Act. |
Nothing in this subsection (e) is intended to alter the amounts |
reportable under the existing provisions of the Uniform |
Disposition of Unclaimed Property Act or to allow the |
imposition of additional statutory interest under Article XIV |
of the Illinois Insurance Code. |
(f) Failure to meet any requirement of this Section with |
such frequency as to constitute a general business practice is |
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a violation of Section 424 of the Illinois Insurance Code. |
Nothing in this Section shall be construed to create or imply a |
private cause of action for a violation of this Section.
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Section 20. Uniform Disposition of Unclaimed Property Act. |
Nothing in this Act shall be construed to amend, modify, or |
supersede the Uniform Disposition of Unclaimed Property Act, |
including the authority of the State Treasurer to examine the |
records of any person if the State Treasurer has reason to |
believe that such person has failed to report property that |
should have been reported pursuant to the Uniform Disposition |
of Unclaimed Property Act.
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Section 25. Lost policy finder. |
(a) The Department shall develop and implement a lost |
policy finder to assist requesters with locating unclaimed life |
insurance benefits. The lost policy finder shall be available |
online and via other means. The Department shall assist a |
requester with using the lost policy finder, including |
informing the requester of the information that an insurer may |
need to facilitate responding to the request. |
(b) As soon as practicable, but no later than 30 days after |
receiving a request from a requester via the lost policy |
finder, the Department shall: |
(1) forward the request to all insurers deemed |
necessary by the Department in order to successfully |
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respond to the request; and |
(2) inform the requester that the Department received |
the request and forwarded the request to all insurers |
deemed necessary by the Department in order to successfully |
respond to the request. |
(c) Upon receiving a request forwarded by the Department |
through a lost policy finder, an insurer shall search for |
policies and any accounts subject to this Act that insure the |
life of or are owned by an individual named as the decedent in |
the request forwarded by the Department. |
(d) Within 30 days after receiving the request referenced |
in subsection (b) of this Section, or within 45 days after |
receiving the request where the insurer contracts with another |
entity to maintain the insurer's records, the insurer shall: |
(1) report to the Department through the lost policy |
finder the findings of the search conducted pursuant to |
subsection (c) of this Section; |
(2) for each identified policy and account insuring the |
life of, or owned by, the individual named as the decedent |
in the request, provide to a requester who is: |
(A) also the beneficiary of record on the |
identified policy or account, the information |
necessary to make a claim pursuant to the terms of the |
policy or account; and |
(B) not the beneficiary of record on the identified |
policy or account, the requested information to the |
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extent permissible to be disclosed in accordance with |
any applicable law, rule, or regulation and take such |
other steps necessary to facilitate the payment of any |
benefit that may be due under the identified policy or |
account. |
(e) The Department shall, within 30 days after receiving |
from all insurers the information required in item (1) of |
subsection (d) of this Section, inform the requester of the |
results of the search. |
(f) When a beneficiary identified in subsection (d) of this |
Section submits a claim or claims to an insurer, the insurer |
shall process such claim or claims and make prompt payments and |
distributions in accordance with all applicable laws, rules, |
and regulations. |
(g) Within 30 days after the final disposition of the |
request, an insurer shall report to the Department through the |
lost policy finder any benefits paid and any other information |
requested by the Department.
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Section 30. Administrative rules. |
(a) The Department shall adopt rules to administer and |
implement this Act. |
(b) The Department may limit an insurer's Death Master File |
comparisons required under Section 15 of this Act to the |
insurer's electronic searchable files or approve a plan and |
timeline for conversion of the insurer's files to searchable |
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electronic files upon a demonstration of hardship by the |
insurer.
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Section 35. Application. The provisions of this Act apply |
to policies, annuity contracts, and retained asset accounts in |
force on or after the effective date of this Act.
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Section 40. The Illinois Insurance Code is amended by |
changing Section 424 as follows:
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(215 ILCS 5/424) (from Ch. 73, par. 1031)
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Sec. 424. Unfair methods of competition and unfair or |
deceptive acts or
practices defined. The following are hereby |
defined as unfair methods of
competition and unfair and |
deceptive acts or practices in the business of
insurance:
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(1) The commission by any person of any one or more of |
the acts
defined or prohibited by Sections 134, 143.24c, |
147, 148, 149, 151, 155.22,
155.22a, 155.42,
236, 237, 364, |
and 469 of this Code.
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(2) Entering into any agreement to commit, or by any |
concerted
action committing, any act of boycott, coercion |
or intimidation
resulting in or tending to result in |
unreasonable restraint of, or
monopoly in, the business of |
insurance.
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(3) Making or permitting, in the case of insurance of |
the types
enumerated in Classes 1, 2, and 3 of Section 4, |
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any unfair discrimination
between individuals or risks of |
the same class or of essentially the same
hazard and |
expense element because of the race, color, religion, or |
national
origin of such insurance risks or applicants. The |
application of this Article
to the types of insurance |
enumerated in Class 1 of Section 4 shall in no way
limit, |
reduce, or impair the protections and remedies already |
provided for by
Sections 236 and 364 of this Code or any |
other provision of this Code.
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(4) Engaging in any of the acts or practices defined in |
or prohibited by
Sections 154.5 through 154.8 of this Code.
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(5) Making or charging any rate for insurance against |
losses arising
from the use or ownership of a motor vehicle |
which requires a higher
premium of any person by reason of |
his physical disability, race, color,
religion, or |
national origin.
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(6) Failing to meet any requirement of the Unclaimed |
Life Insurance Benefits Act with such frequency as to |
constitute a general business practice. |
(Source: P.A. 99-143, eff. 7-27-15.)
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