Illinois’ State Treasurer is doubling down on a legislative effort to make sure that people get the life insurance money they’re owed.
Treasurer Michael Frerichs is advocating for a measure that would require life insurance companies to review death records dating back to 1996 and distribute any benefits that have been unpaid.
House Bill 302 follows a law that took effect this year that requires life insurance companies to more rigorously locate beneficiaries from 2017 onward.
State Sen. David Koehler says that bill was significantly watered down to get bipartisan support.
“And so this is kind of the second step now to come back with some of the other issues that were taken out of that legislation,” Koehler said. “I guess, we’ll see this year when the debate starts where the opposition is coming from, and how they can justify that. To me, this is pretty straightforward.”
The treasurer's office estimates $550 billion in benefits are owed to Illinois individuals, businesses and nonprofits.
Frerichs says the majority of the unclaimed benefits come from lower dollar policies, marketed in lower-income and minority communities.
“With the understanding that a significant percentage would never claim that money, and they’d get to hold onto it longer,” Frerichs said. “But when they [insurers] were on that person’s doorstep, or they were at their workplace, they made a promise to them that they would take care of their loved ones, and we want to make sure they honor that promise.”
Some of the payouts have been larger. Frerichs says a 28-year-old man recently received a $175,000 payment that he should have received when he was orphaned at age 15.
Frerichs was speaking at a round table in Peoria Wed. at the Carver Community Center. He was joined by local leaders representing city and county government, Carver, NAACP, Illinois Funeral Directors Association and AARP.
Frerichs says he aims to get the measure onto the governor’s desk by Spring.