A measure sponsored by state Sen. Bill Haine (D-Alton) was signed into law Friday.
The measure, House Bill 4633, will allow families and relatives of the deceased to receive unclaimed life insurance benefits.
The legislation, also an initiative of Illinois Treasurer Mike Frerichs, will free up $4.4 billion that has not been given out to beneficiaries. Unclaimed life insurance policies sometimes go unclaimed simply because people do not know they exist or because people are unaware of how to claim such policies.
“This is a great initiative and I am proud to sponsor it,” Haine said. “When insurance companies fail to pay out the proceeds of life insurance policies, they fail to honor their responsibility to the loved ones of the deceased. When people pass, their families are left in a great deal of pain. While these awards and annuities can’t alleviate that pain, they can at least help with covering unexpected end-of-life costs.”
Life insurance companies have come under fire with accusations they have not been diligent enough in awarding benefits to the families and relatives of deceased policyholders. The legislation will create the Unclaimed Life Insurance Benefits Act to correct this.
“I was happy to work with the treasurer, insurance companies and the Illinois Department of Insurance on this measure,” Haine said. “I think this really helped us to form a good, solid piece of legislation.”