New legislation has been enacted in the state of New York, that now requires Life Insurance Companies, to be proactive in their searches for deceased life insurance policy holders. The main focus of these new rules is to make sure, that unclaimed benefits go to the beneficiaries of the policies.
New legislation has been enacted in the state of New York, that now requires Life Insurance Companies, to be proactive in their searches for deceased life insurance policy holders. The main focus of these new rules is to make sure, that unclaimed benefits go to the beneficiaries of the policies.
As with all business in New York if, if they have unclaimed accounts, the funds/assets must be handed over to the State after the specific dormant period, which varies from asset to asset. The same is now true for Life Insurance companies. They must now hand over unclaimed policies to the State, which remains unpaid.
Life insurance policies usually have a three year unclaimed period. The new regulation for life insurers also requires them to submit every year to the Office of the State Comptroller the number of policies for which a death occurred but for which the insurers were unable to find the beneficiary.
Local Governments in the past were ignoring these unclaimed accounts. These unclaimed insurance accounts were in the millions and millions of dollars so the Governments now want to ensure that life insurance companies make every effort to locate the beneficiaries of the policies.
New York was the first state that requires life insurances companies to check State databases of recent deaths against their policy holders. This will ensure, that the beneficiaries of the policy will receive the benefits that the holder of the life insurance policy intended them to have and will help put millions of unclaimed money back into the pockets of the rightful owners of these funds. Other states are now following suit.
When New York first began to investigate life insurance companies, they helped over 32,000 consumers receive more than $262 million in unclaimed death benefits. In New York alone, over $95 million in unclaimed money was handed back to over 7,000 residents.
“People sacrifice to buy life insurance to help their loved ones after their death, so it’s reasonable to make sure their families actually receive the benefits when they are eligible. Our investigation clearly proved that life insurers should be checking the list of recent deaths as a standard practice to find out when benefits may be due,” Governor Cuomo said.
Life Insurance Companies must now do the following:
1. Request more detailed beneficiary information, when a policy is sold.
3. Cross-check policies with consumer requests received through the State’s new Lost Policy Finder at www.NYPolicyFinder.com.
4. Every three months, Cross check their insurances policies with recent deaths.
5. Search for multiple policies on the same person in the files of all insurers owned by a holding company.
“The new legislation by New York, is great news for consumers, since as a beneficiary they will now be notified sooner if they have an unclaimed life insurance benefit. Let’s hope other states follow New York's lead”, says Edward Palonek, founder of Foundmoney.com, a company that provides information to Americans on where they may find lost or forgotten money and other assets.
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