Synopsis As Introduced Amends the Illinois Marriage and Dissolution of Marriage Act. Provides that as to any policy of life insurance insuring the life of either spouse, or any interest in such policy, that constitutes non-marital property, or constitutes marital property but was not specifically allocated between the parties as provided in the Act, a beneficiary designation made by or on behalf of the decedent prior to the entry of the judgment of dissolution or declaration of invalidity of marriage that provides for the payment or transfer at death of any of the proceeds of the policy to or for the benefit of the decedent's former spouse is void as of the time of the judgment of dissolution or declaration of invalidity of marriage and the policy proceeds shall pass as if the decedent's former spouse predeceased the decedent. Provides that a life insurance company that insures the life of either spouse or holds a policy in which either spouse has an interest will not be held liable for distributing the proceeds or transferring an interest in such a policy if it is disburses the proceeds or transfers the interest prior to the actual receipt of proof of the judgment of dissolution or declaration of invalidity of marriage.
Senate Committee Amendment No. 1 Replaces everything after the enacting clause. Amends the Illinois Marriage and Dissolution of Marriage Act. Provides that if a judgment of dissolution of marriage is entered after an insured has designated the insured's spouse as a beneficiary under a life insurance policy in force at the time of entry, the designation of the insured's former spouse as beneficiary is not effective unless: (1) the judgment designates the insured's former spouse as the beneficiary; (2) the insured redesignates the former spouse as the beneficiary after entry of the judgment; or (3) the former spouse is designated to receive the proceeds in trust for, on behalf of, or for the benefit of a child or a dependent of either former spouse. Provides that if a designation is not effective, the proceeds of the policy are payable to the named alternative beneficiary or, if there is not a named alternative beneficiary, to the estate of the insured. Provides that an insurer that pays the proceeds of a life insurance policy to the beneficiary under a designation that is not effective is liable for payment of the proceeds to the entitled person or estate only if: (A) before payment of the proceeds to the designated beneficiary, the insurer receives written notice at the home office of the insurer from an interested person that the designation is not effective; and (B) the insurer has not filed an interpleader.
House Committee Amendment No. 1 Exempts life insurance policies provided under plans governed by the Employee Retirement Income Security Act of 1974, the Federal Employee Group Life Insurance Act, or any other preempting federal law.