2003 Legislation
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HOUSE BILL NO. 175 – Life insurance benef/pymt/interest

HOUSE BILL NO. 175

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Daily Data Tracking History



H0175..............................................................by BUSINESS
LIFE INSURANCE - BENEFITS - Adds to existing law to require that the proceeds
of benefits under a life insurance policy be paid within a certain time
period; and to provide for payment of interest for untimely payment in certain
circumstances.
                                                                        
02/06    House intro - 1st rdg - to printing
02/07    Rpt prt - to Bus
02/12    Rpt out - rec d/p - to 2nd rdg
02/13    2nd rdg - to 3rd rdg
02/14    3rd rdg - PASSED - 61-2-7
      AYES -- Andersen, Bauer, Bedke, Bell, Black, Block, Boe, Bolz, Bradford,
      Campbell, Cannon, Clark, Crow, Cuddy, Deal, Denney, Douglas, Edmunson,
      Ellsworth, Eskridge, Field(18), Field(23), Gagner, Garrett, Harwood,
      Henbest, Jaquet, Kellogg, Kulczyk, Lake, Langford, Langhorst, Martinez,
      McGeachin, McKague, Meyer, Miller, Mitchell, Moyle, Naccarato, Raybould,
      Ridinger, Ring, Ringo, Roberts, Robison, Sali, Sayler,
      Schaefer(Schaefer), Shepherd, Shirley, Skippen, Smith(30), Smith(24),
      Smylie, Snodgrass, Stevenson, Tilman, Trail, Wills, Mr. Speaker
      NAYS -- Barraclough, Nielsen
      Absent and excused -- Barrett, Bieter, Collins, Eberle, Jones, Rydalch,
      Wood
    Floor Sponsor - Jaquet
    Title apvd - to Senate
02/17    Senate intro - 1st rdg - to Com/HuRes
02/28    Rpt out - rec d/p - to 2nd rdg
03/03    2nd rdg - to 3rd rdg
03/10    3rd rdg - PASSED - 33-0-2
      AYES -- Andreason, Bailey, Brandt, Bunderson, Burtenshaw, Calabretta,
      Cameron, Compton, Darrington, Gannon, Geddes, Goedde, Hill, Ingram,
      Kennedy, Keough, Little, Lodge, Malepeai, Marley, McKenzie, McWilliams,
      Noble, Noh, Pearce, Richardson, Schroeder, Sorensen, Stegner, Stennett,
      Sweet, Werk, Williams
      NAYS -- None
      Absent and excused -- Burkett, Davis
    Floor Sponsor - Cameron
    Title apvd - to House
03/11    To enrol
03/12    Rpt enrol - Sp signed
03/13    Pres signed
03/14    To Governor
03/17    Governor signed
         Session Law Chapter 85
         Effective: 07/01/03

Bill Text


                                                                        
                                                                        
  ||||              LEGISLATURE OF THE STATE OF IDAHO             ||||
 Fifty-seventh Legislature                 First Regular Session - 2003
                                                                        
                                                                        
                              IN THE HOUSE OF REPRESENTATIVES
                                                                        
                                     HOUSE BILL NO. 175
                                                                        
                                   BY BUSINESS COMMITTEE
                                                                        
  1                                        AN ACT
  2    RELATING TO LIFE INSURANCE TRADE PRACTICES; AMENDING  CHAPTER  13,  TITLE  41,
  3        IDAHO  CODE,  BY  THE  ADDITION  OF  A NEW SECTION 41-1336, IDAHO CODE, TO
  4        REQUIRE PAYMENT OF THE PROCEEDS OF BENEFITS UNDER A LIFE INSURANCE  POLICY
  5        WITHIN  A SPECIFIED TIME PERIOD, TO PROVIDE FOR THE PAYMENT OF INTEREST ON
  6        DEATH BENEFITS IF TIMELY PAYMENT IS NOT  MADE,  TO  PROVIDE  THE  RATE  OF
  7        INTEREST  AND  TO  PROVIDE THAT THE REQUIREMENT OF THE PAYMENT OF INTEREST
  8        APPLIES ONLY TO LUMP SUM PAYMENTS.
                                                                        
  9    Be It Enacted by the Legislature of the State of Idaho:
                                                                        
 10        SECTION 1.  That Chapter 13, Title 41, Idaho Code, be,  and  the  same  is
 11    hereby  amended by the addition thereto of a NEW SECTION, to be known and des-
 12    ignated as Section 41-1336, Idaho Code, and to read as follows:
                                                                        
 13        41-1336.  LIFE INSURANCE --  PAYMENT  OF  INTEREST  ON  BENEFITS.  (1)  An
 14    insurer  shall  pay the proceeds of any benefits under a policy of life insur-
 15    ance not more than thirty (30) days after the insurer has  received  satisfac-
 16    tory  proof  of  death of the insured. Except as provided in subsection (2) of
 17    this section, if the proceeds are not paid within the thirty (30) day  period,
 18    the  insurer shall also pay interest on the proceeds from the date of death of
 19    the insured to the date when the proceeds are paid.
 20        (2)  If satisfactory proof of death is  received  more  than  one  hundred
 21    eighty  (180)  days  after the death of the insured and the death benefits are
 22    not paid within thirty (30) days after satisfactory proof of  death  has  been
 23    received  by  the insurer, interest shall accrue from the date on which satis-
 24    factory proof was received by the insurer to the date when proceeds are paid.
 25        (3)  The rate of interest to be paid by the insurer under subsections  (1)
 26    and  (2)  of  this section shall be the current rate of interest on death pro-
 27    ceeds on deposit with the insurer; provided however, that if the insurer holds
 28    its deposits in a noninterest-bearing account or in an  account  bearing  less
 29    than  two  percent  (2%)  interest  per annum, the rate of interest to be paid
 30    shall be the one (1) month United States government securities  treasury  con-
 31    stant  maturity  rate  as disclosed in the federal reserve statistical release
 32    publication H.15, selected interest rates, as of the first of the  month  pre-
 33    ceding the date of death, plus two (2) percentage points.
 34        (4)  A payment of interest shall not be required under this section in any
 35    case  in which the beneficiary elects to receive the proceeds under the policy
 36    by any means other than a lump sum payment.

Statement of Purpose / Fiscal Impact


                      STATEMENT OF PURPOSE
                                
                            RS 12413
                                
                                
Life insurers are not currently required to pay interest on death
proceeds to Idaho residents. This act provides that a life insurer
must pay interest on death proceeds if payment of the proceeds is not
made to the beneficiary within thirty days after satisfactory proof of
death is received by the insurer.





                         FISCAL IMPACT
                                
None.








                  Contact:  John Mackey
                           332-2685
                  
         STATEMENT OF PURPOSE/FISCAL NOTE                        H 175