Insurers doing business in New York are now required to regularly search a government list of recent deaths to identify policyholders, then find and pay beneficiaries even when no claims are made.
New York State Department of Financial Services says that follows its investigation last year that resulted in life insurance companies paying more than $262 million to nearly 33,000 consumers nationwide.
Investigators found many insurance companies regularly checked the list of recent deaths from the U.S. Social Security Administration to stop making payments on annuities after someone had died, but didn’t do the same when owing death benefits.
Insurers now must cross check their policies every three months.
The new regulation also tells life insurers to report annually to the state comptroller the number of policies with no beneficiary found.
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