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A09845 Summary:

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A09845 Floor Votes:

A09845 Text:

 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                         9845--B
                                                                   R. R. 215
 
                   IN ASSEMBLY
 
                                     April 18, 2012
                                       ___________
 
        Introduced  by  M. of A. MORELLE, WEINSTEIN -- read once and referred to
          the Committee on Insurance  --  committee  discharged,  bill  amended,
          ordered  reprinted  as  amended  and  recommitted to said committee --
          reported and referred to the Committee on  Rules  --  amended  on  the

          special  order of third reading, ordered reprinted as amended, retain-
          ing its place on the special order of third reading
 
        AN ACT to amend the insurance law, in relation to unclaimed life  insur-
          ance benefits
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
 
     1    Section 1. The insurance law is amended by adding a new section 3213-a
     2  to read as follows:
     3    § 3213-a. Unclaimed benefits. (a) Definitions.  For  the  purposes  of
     4  this section:
     5    (1) "Account" means any mechanism, whether denoted as a retained asset
     6  account  or  otherwise,  whereby the settlement of proceeds payable to a
     7  beneficiary under a policy is accomplished by the insurer or  an  entity

     8  acting  on  behalf of the insurer where the proceeds are retained by the
     9  insurer pursuant to a supplementary contract.
    10    (2) "Death index" means the death master file maintained by the United
    11  States social security administration or any other database  or  service
    12  that is at least as comprehensive as the death master file maintained by
    13  the  United States social security administration and that is acceptable
    14  to the superintendent.
    15    (3) "Insured" includes an individual covered by a policy or an  annui-
    16  tant when the annuity contract provides for benefits to be paid or other
    17  monies to be distributed upon the death of the annuitant.
    18    (4)  "Insurer"  means  a  life  insurance company or fraternal benefit
    19  society.

    20    (5) "Lost policy finder" means a service made available by the depart-
    21  ment on its website or otherwise developed by the superintendent  either
    22  on  his  or  her  own  or in conjunction with other state regulators, to
    23  assist consumers in locating unclaimed life insurance benefits.
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD15333-08-2
        A. 9845--B                          2
 
     1    (6) "Policy" means a life insurance policy,  including  policies  that
     2  have lapsed or been terminated, annuity contract, or a certificate under
     3  a  life insurance policy or annuity contract, or a certificate issued by

     4  a fraternal benefit society, under which benefits are to  be  paid  upon
     5  the death of the insured.
     6    (b) Applicability. This section shall apply to:
     7    (1)  Every  policy issued by a domestic insurer and any account estab-
     8  lished under or as a result of such policy; and
     9    (2) Every policy delivered or issued for delivery in New  York  by  an
    10  authorized  foreign  insurer  and  any account established under or as a
    11  result of such policy.
    12    (3) Notwithstanding paragraphs one and two of  this  subsection,  with
    13  respect to a policy delivered or issued for delivery outside this state,
    14  a  domestic  insurer  may,  in lieu of the requirements of this section,
    15  implement procedures that meet the minimum requirements of the state  in

    16  which  the policy was delivered or issued, provided that the superinten-
    17  dent concludes that such other requirements are no less favorable to the
    18  policyowner and beneficiary than those required by this section.
    19    (4) Notwithstanding the provisions of paragraphs one and two  of  this
    20  subsection,  this  section shall not apply to lapsed or terminated poli-
    21  cies with no benefits  payable  that  were  searched  within  the  three
    22  hundred  sixty-five days preceding the effective date of this section or
    23  that were searched more than eighteen months prior to  the  most  recent
    24  search conducted by the insurer.
    25    (c)  Identifying information. (1) Except as set forth in paragraph two
    26  of this subsection, at no later than policy delivery or  the  establish-

    27  ment  of  an account and upon any change of insured, owner, or benefici-
    28  ary, every insurer shall request information sufficient to  ensure  that
    29  all  benefits or other monies are distributed to the appropriate persons
    30  upon the death of the insured or account holder, including, at  a  mini-
    31  mum, the name, address, social security number, date of birth, and tele-
    32  phone  number  of every owner, insured and beneficiary of such policy or
    33  account, as applicable.
    34    (2) Where an insurer issues a policy or provides for an account  based
    35  on  data  received  directly from an insured's employer, the insurer may
    36  obtain the beneficiary information described in paragraph  one  of  this
    37  subsection after receiving the data from the insured's employer.

    38    (d) Standards for cross-checking policies. (1) Every insurer shall use
    39  the  death index to cross-check every policy and account subject to this
    40  section no less  frequently  than  quarterly,  except  as  specified  in
    41  subsection  (g)  of this section. An insurer may perform the cross-check
    42  using the updates made to the death index since the  date  of  the  last
    43  cross-check performed by the insurer, provided that the insurer performs
    44  the  cross-check  using the entire death index at least once a year. The
    45  superintendent may promulgate rules and regulations that allow an insur-
    46  er to perform the cross-checks less frequently than quarterly, provided,
    47  however, the insurer must not be allowed to  perform  such  cross-checks
    48  less than semi-annually.

    49    (2)  The  cross-checks  shall  be  performed using the social security
    50  number, the name, and date of birth of the insured or account holder.
    51    (3) If an insurer only has a partial  name,  social  security  number,
    52  date of birth, or a combination thereof, of the insured or account hold-
    53  er under a policy or account, the insurer shall use the available infor-
    54  mation to perform the cross-check.
        A. 9845--B                          3
 
     1    (4) Every insurer shall implement reasonable procedures to account for
     2  common  variations  in data that would otherwise preclude an exact match
     3  with a death index.
     4    (e) Multiple policy search procedures. (1) Upon receiving notification

     5  of  the death of an insured or account holder or in the event of a match
     6  made by a death index cross-check pursuant to  subsection  (d)  of  this
     7  section, an insurer shall search every policy or account subject to this
     8  section  to  determine  whether  the  insurer  has any other policies or
     9  accounts for the insured or account holder.
    10    (2) Every insurer that receives a notification of  the  death  of  the
    11  insured  or  account  holder,  or  identifies a death index match, shall
    12  notify each United States affiliate and  any  entity  that  the  insurer
    13  contracts  with  which may maintain records relating to policies covered
    14  by this section of the notification or verified death index  match,  who

    15  shall  then  perform  the  search  required  by  paragraph  one  of this
    16  subsection.
    17    (f) Standards for locating claimants. (1) Every insurer  shall  estab-
    18  lish procedures to reasonably confirm the death of an insured or account
    19  holder  and  begin  to locate beneficiaries within ninety days after the
    20  identification of a potential match made by a death index cross-check or
    21  by a search conducted by the insurer pursuant to subsection (e) of  this
    22  section.  If  the insurer cannot locate beneficiaries within ninety days
    23  after the identification of a potential match, the insurer shall contin-
    24  ue to search for beneficiaries until the benefits escheat to the state.
    25    (2) Once the beneficiary or beneficiaries under the policy or  account

    26  have been located, the insurer shall provide to the beneficiary or bene-
    27  ficiaries  the  information  necessary  to  make a claim pursuant to the
    28  terms of the policy or account. The insurer shall process all claims and
    29  make prompt payments and distributions in accordance with all applicable
    30  laws, rules, and regulations.
    31    (3) Nothing herein shall prevent an insurer from  requiring  satisfac-
    32  tory  proof  of  loss,  such  as a death certificate, for the purpose of
    33  verifying the death of the insured.
    34    (g) This section shall not apply to:
    35    (1) group policies where the insurer does not maintain records on  its
    36  administrative  systems  containing  the information necessary to comply
    37  with the requirements of this section;

    38    (2) any policy or certificate that provides a death benefit  under  an
    39  employee  benefit,  government  or  church plan subject to or as defined
    40  under the Employee Retirement Income Security Act of 1974 (29 USC 1002),
    41  as periodically amended, or under any Federal employee benefit program;
    42    (3) any other circumstance as determined  to  be  appropriate  by  the
    43  superintendent.
    44    (h)  Lost  policy  finder.  (1)  The  superintendent shall develop and
    45  implement  a  lost  policy  finder  to  assist  requestors  in  locating
    46  unclaimed  life  insurance  benefits.  The  lost  policy finder shall be
    47  available online and via other means, including but not limited  to  the
    48  department's toll free telephone number. The superintendent shall assist

    49  a  requestor  in  using  the lost policy finder, including informing the
    50  requestor of what information an insurer may need to facilitate respond-
    51  ing to the request.
    52    (2) As soon as practicable but no later than thirty days after receiv-
    53  ing a request from a requestor via the lost policy  finder,  the  super-
    54  intendent shall:
        A. 9845--B                          4
 
     1    (i) forward the request to all insurers deemed necessary by the super-
     2  intendent  in  order  to successfully respond to the consumer's request;
     3  and
     4    (ii)  inform  the  requestor  in  writing  that  the  request has been
     5  received and forwarded to all insurers deemed necessary  by  the  super-

     6  intendent in order to successfully respond to the request.
     7    (3) Upon receiving a request forwarded by the superintendent through a
     8  lost  policy finder application, every insurer shall search for policies
     9  and any accounts subject to this section that insure the life of, or are
    10  owned by, an individual named as the decedent in the  request  forwarded
    11  by the superintendent.
    12    (4)  Within  thirty  days of receiving the request referenced in para-
    13  graph two of this subsection, the insurer shall:
    14    (i) report to the superintendent through the lost  policy  finder  the
    15  findings  of  the  search  conducted pursuant to paragraph three of this
    16  subsection;
    17    (ii) for each identified policy and account insuring the life  of,  or

    18  owned  by,  the  named  insured,  provide to a requestor who is also the
    19  beneficiary of record on the identified policy or account  the  informa-
    20  tion  necessary  to  make a claim pursuant to the terms of the policy or
    21  account;
    22    (iii) for each identified policy and account insuring the life of,  or
    23  owned by, the named insured, provide to a requestor who is not the bene-
    24  ficiary  of  record  on  the  identified policy or account the requested
    25  information to the extent permissible to be disclosed in accordance with
    26  any applicable law, rule, and regulation and to take  such  other  steps
    27  necessary to facilitate the payment of any benefit that may be due under
    28  the identified policy or account; and

    29    (5) The superintendent shall, within thirty days of receiving from all
    30  insurers  the information required in subparagraph (i) of paragraph four
    31  of this subsection, inform the requestor of the results of the search.
    32    (6) When a beneficiary identified in paragraph four of this subsection
    33  submits a claim or claims to an insurer, the insurer shall process  such
    34  claims and make prompt payments and distributions in accordance with all
    35  applicable laws, rules, and regulations.
    36    (7)  Within  thirty  days of the final disposition of the request, the
    37  insurer shall report to  the  superintendent  through  the  lost  policy
    38  finder  any  benefits  paid  and  any other information requested by the
    39  superintendent.

    40    (8) Every insurer shall establish procedures to electronically receive
    41  the lost policy finder application request from, and  make  reports  to,
    42  the  superintendent  as  provided  for in this section. When transmitted
    43  electronically, the date that the superintendent  forwards  the  request
    44  shall  be deemed to be the date of receipt by the insurer unless the day
    45  is a Saturday, Sunday or a public holiday, as defined in  section  twen-
    46  ty-five  of  the general construction law and, in such case, the date of
    47  receipt shall be as provided in section  twenty-five-a  of  the  general
    48  construction  law.    The  superintendent may promulgate rules and regu-
    49  lations that allow an  insurer  to  apply  for  an  exemption  from  the

    50  requirement that it electronically receive the lost policy finder appli-
    51  cation request.
    52    (i)  Reports.  Every  insurer subject to this section shall include in
    53  the report required under section seven hundred three of  the  abandoned
    54  property  law any information on unclaimed benefits due pursuant to this
    55  section the number of policies and accounts that the insurer has identi-
    56  fied pursuant to this section for the prior calendar  year  under  which
        A. 9845--B                          5
 
     1  any  outstanding  monies  have  not been paid or distributed by December
     2  thirty-first of such year except potential matches still being  investi-
     3  gated  pursuant  to  paragraph one of subsection (f) of this section.  A

     4  copy of the report shall also be filed with the superintendent.
     5    (j) The superintendent is authorized to promulgate any rules and regu-
     6  lations necessary to implement the provisions of this section in accord-
     7  ance with the provisions of the state administrative procedure act.
     8    § 2. This act shall take effect on the one hundred eightieth day after
     9  it shall have become a law.