Life insurance companies will have to do more to track down beneficiaries of the deceased under a bill that passed the Florida House on Monday and goes back to the Florida Senate for final approval.
Florida Chief Financial Officer Jeff Atwater has made the issue a top priority this year because he said there is a systemic practice within the life insurance industry in which many companies are sitting on billions of dollars in overdue, unpaid life insurance benefits. He said some companies are doing little to track down families whose loved ones paid their premiums for years.
"For years insurance companies had no trouble sending their agents to their house for the weekly payment," Atwater said during a Senate Banking and Insurance committee meeting on the topic in January. "They knew exactly where they lived for 20 years. But now that it may be time to pay up, it’s a horrified hardship to find that individual."
Atwater said some insurance companies have made it so the only way beneficiaries can collect is if they can locate the policy paperwork, of which they may not be aware, and present a death certificate to the company.
Under Senate Bill 966 insurers would be required to search the Social Security Administration's Death Master File for all of their policyholders retroactively to 1992 and every year going forward. If a beneficiary cannot be found, the insurance company must turn the policy over to the State of Florida’s Unclaimed Property Program, currently overseen by Atwater, where the state will continue to look for rightful beneficiaries.
The House passed the bill on a 109-0 vote. It now goes back to the Florida Senate. If the bill is approved there it would go to Gov. Rick Scott for his approval.