New York Governor Andrew Cuomo said a new website will help life-insurance beneficiaries learn about funds that they are owed after a state review of unpaid payments resulted in awards of more than $200 million.
“Something must be done to make sure families across New York receive the life insurance benefits that they are due,” Cuomo said today in a statement. “A new website will help families search for lost or forgotten policies.”
Life insurers have faced increased scrutiny from regulators in Florida, California and other states over unpaid benefits. New York’s insurance regulator last year ordered firms to use current Social Security Administration data to determine when death payments are due.
An investigation by the state’s Department of Financial Services into instances where insured parties died and beneficiaries didn’t file claims has led to more than 32,000 payments totaling $262.2 million, according to the statement. That is up from the $52.6 million that had been distributed to almost 8,000 beneficiaries when the regulator provided an update in December.
Insurers are still investigating more than 445,000 potential matches for unpaid claims, the regulator said today. Consumers can use an online tool at NYPolicyFinder.com to locate life insurance policies and annuities that have been lost or misplaced, according to the statement.
MetLife Inc. (MET), the largest U.S. life insurer, took a $117 million charge in the third quarter related to unpaid death benefits, while American International Group Inc. (AIG) has added to reserves after changing its process for determining when policyholders die.
Life insurers are generally required to pay claims after being notified of a policyholder’s death and receiving a valid death certificate. If insurance companies aren’t notified, they usually are required to hold the funds until the insured would be about 100 years old, plus an additional three or five years, depending on the jurisdiction, before turning the money over to the state as unclaimed property.
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