We are wrapping up our discussion of a number of lawsuits, one filed here in Florida, against life insurance companies. The plaintiffs accuse the insurers of holding on to death benefits when the companies know or should know that the insured has passed away.
We have been talking about a lawsuit filed by an asset recovery company against several life insurance companies. At issue is how the companies track insureds and locate beneficiaries once an insured has passed away. Florida has been at the forefront of putting pressure on life insurers to implement more efficient and effective internal procedures.
What happens to life insurance proceeds if the beneficiary has no idea he is on the policy? This is not a philosophical question or open to an "if a tree falls in the forest" debate. The law anticipates that this will happen, and state agencies like the Florida Department of Financial Services and the Office of Insurance Regulation do what they can to enforce the laws.
We have talked about the problem of unclaimed life insurance benefits before. In October 2012, for example, we posted about the state of Florida's settlement with Nationwide Financial Services Inc. regarding its process for identifying insureds and notifying beneficiaries. Nationwide was the fourth life insurer to settle with the state, and consumer advocates and other states' regulators praised Florida's enforcement efforts.
Every year, generally around tax time, people go through their paper files to clean out the old stuff and put in the new. Out goes the investment account summary from 2004 -- the rule is seven years, right? Keep important papers and tax records for seven years, then shred them?
Florida Rep. Mario Diaz-Balart believes the country should catch up with his home state when it comes to building codes. The congressman is the chief House sponsor of HR 1878, the Safe Building Code Incentive Act of 2013. The bill was also introduced in 2007, 2009 and 2011. Proponents hope that the fourth time is the charm.
Florida Gov. Rick Scott apparently had no reaction to the Citizens reform bill that landed on his desk last week. His office said only that he was "reviewing the proposal." There was no hint that he was either disappointed or relieved that the rating methodology changes did not make it into the final bill. Legislators and homeowners alike will just have to wait to see what happens.
The Florida Legislature has sent a less ambitious insurance bill to Gov. Rick Scott than some lawmakers had hoped. The bill does not offer a complete overhaul of Citizens Property Insurance Corp.; rather, it represents a more incremental approach to reform that seemed to go over better with legislators concerned, in particular, about raising rates.