Changes to Illinois Unclaimed Life Insurance Benefits Act Become Law

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The Unclaimed Life Insurance Benefits Act, which requires insurers to periodically match their policies, annuity contracts, and retained asset accounts against the United States Social Security Administration’s Death Master File was signed into law on August 26, 2016 and became effective January 1, 2017.  In January of 2017, Illinois State Treasurer Michael W. Frerichs proposed changes to the Unclaimed Life Insurance Benefits Act to provide that the Act applies to certain records of policies, contracts and accounts in force at any time on or after January 1, 2000 to the extent that an insurer has electronic searchable files concerning those policies, contracts and accounts.  The legislation, House Bill 302, passed both Houses on May 31, 2017.  On August 25, 2017 Governor Rauner amendatorily vetoed the legislation to remove the aforementioned provision and to add a provision to the Illinois Uniform Disposition of Unclaimed Property Act to prohibit the State Treasurer from contracting with auditors on a contingency-fee basis.  On November 8, 2017, the Governor’s amendatory veto was overridden by both the House and Senate.  House Bill 302 became law on November 9, 2017 with an effective date of January 1, 2018.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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