ND Insurance Department recovers $5.5 million for life insurance beneficiaries
BISMARCK - North Dakota Insurance Commissioner Jon Godfread announced Wednesday that his department has recovered more than $5.5 million for North Dakota life insurance beneficiaries who may have never found the money.The department found the mon...
BISMARCK - North Dakota Insurance Commissioner Jon Godfread announced Wednesday that his department has recovered more than $5.5 million for North Dakota life insurance beneficiaries who may have never found the money.
The department found the money by examining the 30 top life insurers' use of the Social Security Administration's Death Master File.
The file is a comprehensive list of people who have died in the U.S., but Godfread said the examinations found that most life insurance companies have unfairly used the list in the past to stop payments for dead annuity holders, but have not used the database to identify life insurance policyholders who have passed away to pay beneficiaries. Of the 30 company examinations, 28 resulted in settlements and changes to beneficiary search practices That prohibit companies from conducting the unfair searches.
"This is a huge victory for North Dakota consumers," Godfread said in a news release. "Searching for and locating life insurance beneficiaries is a critical part of this business. The department is committed to working together with other states to continue investigating insurance companies' use of the file because with the tools available to insurance companies today, there is no reason for them not to search for and locate policy beneficiaries."
Two recent agreements were made with Aflac and State Farm after coordinated multistate examinations among state insurance departments in North Dakota, California, Florida, New Hampshire and Pennsylvania. North Dakota will receive approximately $15,000 from the agreements. Additionally, under the terms of the settlements, Aflac and State Farm will continue to implement a number of business reforms
As a result of the 30 company investigations, state insurance regulators have paid $8.7 billion to life insurance beneficiaries nationwide. The North Dakota department has been part of 28 multistate settlements with insurance companies regarding life insurance practices and to date has received almost $2.6 million for North Dakota. Efforts continue to be focused on the examination of 10 remaining life insurers: Northwestern Mutual, Great West, Protective Life, American Equity, Principal Financial, Allstate, Western Southern, OneAmerica, Ohio National and American National.
The National Association of Insurance Commissioners has also created a Life Insurance Policy Locator application. The application is a free service intended to be an easy-to-use tool to help insurance consumers find lost or forgotten life insurance policies and annuity contracts. Since the application's launch in 2016, six policies have been found in the state with $254,000 claimed. The locater in the state can be found at the department's website at www.nd.gov/ndins .
"There are many North Dakotans who don't know they could be missing life insurance policies, or don't know where to begin to locate them," Godfread said in the release. "The Life Insurance Policy Locator tool on our website is critical in helping reconnect people with lost life insurance policies. This tool is simple to use and easy to access, I encourage everyone to check it out."