Bill: SB 561, 85(R) - 2017

Bill Caption

Relating to the identification and handling of unclaimed life insurance and annuity contract proceeds.  

Fiscal Notes

From the Legislative Budget Board: the number of policies that would be affected under the bill's provisions is unknown; therefore, the bill would have an indeterminate fiscal impact to the state beginning in FY2021.

Bill Analysis

SB 561 would amend the Insurance Code to require insurers to compare its in-force life insurance policies, annuity contracts, and retained asset accounts to a Death Master File at least semi-annually to identify any matches. For each match with the Death Master File, the insurer must, by no later than the 90th day of discovery, confirm the death of the account holder, determine if the account holder had any additional coverage, and determine if any proceeds may be due. If a match is confirmed, but the insurer has failed to locate a beneficiary by the third anniversary of the date, the proceeds will remain as unclaimed and be delivered to the comptroller. 

Vote Recommendation Notes

This bill violates our free market and limited government by adding a regulation on how insurers must handle unclaimed life insurance and annuity contract proceeds, which is not a proper role of government.

We do understand that in some instances this may provide benefits to insurance providers that suffer at the hands of other aspects of government. However, we do believe the bill could be amended to alleviate our concerns. If this program as a whole were to be made permissive, instead of mandatory. We would withdraw our objection. Allowing individual companies to choose whether or not to participate in the program would balance the benefits perceived by many in the industry with the need for limited government and fewer mandates. As this bill stands though, we oppose SB 561.

Source URL (retrieved on 04/24/2024 09:04 PM): http://reports.texasaction.com/bill/85r/sb561?print_view=true