Alert: Minnesota AG and DOC Investigating Compliance With State Escheat LawsPrint PDFShare
The Minnesota Attorney General’s (AG) office and Department of Commerce (DOC) have commenced an investigation to determine whether insurance companies are complying with state escheat laws. In accordance with state laws, the AG and DOC seek to ensure that life insurers are not keeping unclaimed death benefits that should be property of the state. Pursuant to its investigation, the AG and DOC are requesting insurance companies submit reports that include: (i) information regarding any deficiencies in the company’s reporting; (ii) steps the company is taking to prevent reoccurrence of deficiencies; and (iii) confirmation that the company is submitting amended reports and making prompt payment of funds to the state as necessary to fully comply with state law. Minnesota’s statutes with respect to unclaimed property are provided in Minn. Stat. Chapter 345.
The issue of compliance with escheat laws has been raised in other states. Earlier this year, an investigation in California found that insurance companies were using the Social Security Death Master File (DMF) to stop making annuity payments as soon as policy holders were deceased, but were not using the same information from the DMF to promptly pay beneficiaries of life insurance policies or turn over unclaimed property to the state. As many as 38 states, including Minnesota, are now undertaking investigations to determine whether insurance companies are complying with their respective state laws.
For more information about the ongoing investigations of insurance companies with respect to death benefits, please contact your Briggs and Morgan attorney or Frank Taylor, Julie Firestone, Brent Lindahl or Christine Kim.