Public Act 099-0893
 
HB4633 EnrolledLRB099 18214 JLS 44479 b


  
    AN ACT concerning business.
  
 
    Be it enacted by the People of the State of Illinois,
 
represented in the General Assembly:
  


 
    Section 1. Short title. This Act may be cited as the 
Unclaimed Life Insurance Benefits Act.
 
    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.
 
    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 
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 
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.
 
    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 
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 
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 
    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 
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.
 
    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.
 
    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 
    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 
        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.
 
    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 
electronic files upon a demonstration of hardship by the 
insurer.
 
    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.
 
    Section 40. The Illinois Insurance Code is amended  by 
changing Section 424 as follows:
 



    (215 ILCS 5/424)  (from Ch. 73, par. 1031)



    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:

        (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.

        (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.

        (3) Making or permitting, in the case of insurance of 
    the types
enumerated in Classes 1, 2, and 3 of Section 4, 
    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.

        (4) Engaging in any of the acts or practices defined in 
    or prohibited by
Sections 154.5 through 154.8 of this Code.

        (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.

        (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.)