Illinois State Treasurer Michael Frerichs has called for statewide hearings to educate the public on how life insurance companies avoid paying death benefits. The first hearing is scheduled for August 17th in Normal, Illinois. According to Frerichs, since 2011, the Illinois State Treasurer’s office has identified more than $550 million
Life Insurance & Annuities
New York Life Industry Update: Principle-Based Reserving for Life Insurers coming in 2018
This week, the New York Department of Financial Services (the “Department”) announced that it will adopt a principle-based reserving (“PBR”) approach for life insurers beginning in 2018. The Department has also established a working group to help implement certain reserve safeguards.
New York had been one of the few outlier…
Illinois Federal Court Dismisses Claim That Premium Payment After Insured’s Death Reinstated Lapsed Life Insurance Policy
The U.S. District Court for the Northern District of Illinois recently dismissed a complaint filed by a policy beneficiary asserting that her husband’s lapsed life insurance policy was reinstated because she paid the unpaid premiums five days after her husband’s death. The beneficiary argued that the insurer waived the right…
Ninth Circuit Overturns Taxpayer-Friendly Decision in Demutualizations
On December 9, in Dorrance v. The United States, the Ninth Circuit overturned a favorable district court decision for taxpayers in demutualizations. The Ninth Circuit ruled that a taxpayer owning insurance policies in a mutual insurance company had a zero tax basis in the attendant membership rights which accompanied…
Illinois Treasurer Lawsuit Highlights Contingency Fee Risks in Unclaimed Property Audits
On October 26, 2015, three life insurance companies (the “Kemper Companies”) filed a lawsuit against the Illinois State Treasurer (the “Treasurer”) and private auditing firm, Verus Financial LLC, over the Treasurer’s unclaimed property audits of the Kemper Companies. The lawsuit is the latest litigation between life insurers and state regulators…
NAIC Proposes Changes to Life Insurer Disclosure Requirements and Treatment of Investment Affiliates
This month, the NAIC set forth a variety of proposals relating to changes risk-based capital (“RBC”) requirements, as well as treatment of investment affiliates. In particular, the NAIC seeks to require life insurers to actively disclosure how the use of captives to manage their A-XXX risks would impact the insurer’s…
NY DFS Temporary Head Named
New York Superintendent of Financial Services Benjamin M. Lawsky’s chief of staff will take over leadership of the Department of Financial Services after Lawsky’s departure next week. Mr. Lawsky recently announced that he is leaving the DFS to start his own firm. Anthony Albanese, chief of staff to Benjamin M.
George Unleashes the Giant Peach
The global stock of insurance linked securities at the end of 2014 was approaching $25.2 billion. Yesterday George Osborne unleashed the giant peach for the United Kingdom in a seemingly measured statement but one full of promises.
“2.228 Global reinsurance – the government announced at Autumn Statement 2014 that it…
Committee Proposes Uniform Rules for Unclaimed Insurance Policies
Recently, the Uniform Law Commission’s Committee to Revise the Uniform Unclaimed Property Act met in Washington and adopted uniform rules drafted by an advisory group. These approved recommendations are consistent with the Model Unclaimed Life Insurance Benefits Act which was adopted by the National Conference of Insurance Legislators last year.…
New York Drops Principles Based Reserving Approach for Life Insurers
Benjamin Lawsky, Superintendent of the New York Department of Financial Services (the “Department”), sent a letter [PDF] to the National Association of Insurance Commissioners (“NAIC”) last week criticizing the NAIC’s plan to move forward with implementing the principles based reserving approach (“PBR Approach”) for life insurers.…