HB0235 • 2020

Life insurance benefits-payments and interest.

AN ACT relating to insurance; modifying payments of claims and interest requirements on life insurance benefits as specified; and providing for an effective date.

Enacted

This bill passed the Legislature and reached final enactment based on the latest official action.

Sponsor: Representative Roscoe
Last action: 2020-03-24
Official status: enrolled
Effective date: 7/1/2020

Plain English Breakdown

The bill summary and digest do not provide specific details on how insurers should handle claims that cannot be settled within the 45-day period.

Life Insurance Benefits and Interest Payments

This law changes how life insurance companies handle claims and interest payments for certain types of policies, setting a maximum time limit for settling claims.

What This Bill Does

Sets a 45-day deadline for insurers to settle most life insurance claims after receiving proof of death.
Allows private placement policies to be settled later than the standard 45 days if the assets in these policies cannot immediately be converted into cash.
Specifies how interest on settlements should be calculated, especially for private placement policies.

Who It Names or Affects

People who have life insurance policies
Insurance companies that handle life insurance claims

Terms To Know

Private Placement Policy: A type of variable life insurance policy sold to accredited investors or qualified purchasers without needing public registration.

Limits and Unknowns

The law only applies to policies delivered, issued for delivery, or renewed in the state after July 1, 2020.
It does not specify how insurers should handle claims if they cannot be settled within the 45-day period.

Amendments

These notes stay tied to the official amendment files and metadata from the legislature.

HB0235HS001

Standing Committee • House Corporations, Elections & Political Subdivis

Adopted

Plain English: The amendment modifies insurance claim processing times and adds definitions related to private placement policies.

Adds a new section (26-15-124) that requires insurers to accept or reject claims for life, accident, or health insurance benefits within 45 days after receiving proofs of loss and supporting evidence.
Modifies existing sections by replacing references to 'two (2)' with the time requirements specified in W.S. 26-15-124.
Adds a new definition for 'private placement policy' under variable life insurance policies.

The amendment text does not provide full details on how exceptions to the 45-day claim processing period will be handled, only that they are allowed in certain circumstances.

Bill History

2020-03-24 LSO
Assigned Chapter Number 137
2020-03-24 Governor
Governor Signed HEA No. 0056
2020-03-10 Senate
S President Signed HEA No. 0056
2020-03-10 House
H Speaker Signed HEA No. 0056
2020-03-09 LSO
Assigned Number HEA No. 0056
2020-03-09 Senate
S 3rd Reading:Passed 25-5-0-0-0
2020-03-06 Senate
S 2nd Reading:Passed
2020-03-05 Senate
S COW:Passed
2020-03-04 Senate
S Placed on General File
2020-03-04 Senate
S04 - Education:Recommend Do Pass 5-0-0-0-0
2020-03-03 Senate
:Rerefer to S04 - Education
2020-03-02 Senate
S Introduced and Referred to S10 - Labor
2020-02-28 Senate
S Received for Introduction
2020-02-27 House
H 3rd Reading:Passed 58-0-2-0-0
2020-02-26 House
H 2nd Reading:Passed
2020-02-25 House
H COW:Passed
2020-02-21 House
H Placed on General File
2020-02-21 House
H07 - Corporations:Recommend Amend and Do Pass 9-0-0-0-0
2020-02-14 House
H Introduced and Referred to H07 - Corporations 57-0-3-0-0
2020-02-12 House
H Received for Introduction
2020-02-12 LSO
Bill Number Assigned

Official Summary Text

Bill Summary - 20LSO-0555
Bill No.:

HB0235

Effective:

7/1/2020 12:00:00 AM

LSO No.:

20LSO-0555

Enrolled Act No.:

HEA No. 0056

Chapter No.:

137

Prime Sponsor:

Roscoe

Catch Title:

Life insurance benefits-payments and interest.

Subject:

Life insurance benefits payments of claims and interest.

Summary/Major Elements:

The bill authorizes an insurer to specify the period of time to settle a life insurance claim, which may not exceed forty-five (45) days after receipt of proof of death.

For private placement policies, the bill authorizes settlement in cash, or if allowed under the policy, by distributing assets of the separate account to the claimant, provided that the fair market value of the assets must be independently verified at the time of disbursement. The obligation of the insurer to settle the portion of the policy attributable to separate account assets is subject to the liquidity of the assets and shall be settled when the assets can be converted to cash, which may be later than the forty-five (45) days after receipt of proof of death.

For private placement policies, the bill specifies how interest on a settlement shall be computed. The obligation of the insurer to pay interest on the portion of a policy attributable to separate account assets may only be computed as and when the assets are either converted to cash or otherwise dispersible by the insurer.

The bill defines private placement policy as a variable life insurance policy that is:

Issued exclusively to a person who is an accredited investor or a qualified purchaser, as defined in the Securities Act of 1933 or the Investment Company Act of 1940 or in regulations promulgated under either statute;
Offered for sale and sold in a transaction that is exempt from registration under the Securities Act of 1933.
The above summary is not an official publication of the Wyoming Legislature and is not an official statement of legislative intent. While the Legislative Service Office endeavored to provide accurate information in this summary, it should not be relied upon as a comprehensive abstract of the bill.

Current Bill Text

Read the full stored bill text

20LSO-0555

ORIGINAL House

Bill No
.
HB0235

ENROLLED ACT NO. 56,

HOUSE OF REPRESENTATIVES

SIXTY-FIFTH LEGISLATURE OF THE STATE OF WYOMING
2020 Budget Session

AN ACT relating to insurance; modifying payments of claims and interest requirements on life insurance benefits as specified; and providing for an effective date.

Be It Enacted by the Legislature of the State of Wyoming:

Section 1
.

W.S. 26
‑
15
‑
124(a) and 26
‑
16
‑
112 are amended to read:

26
‑
15
‑
124.

Claim to be accepted or rejected; attorney's fee.

(a)

Claims for benefits under a life, accident or health insurance policy shall be rejected or accepted and paid by the insurer or its agent designated to receive the claims within forty
‑
five (45) days after receipt of the proofs of loss and supporting evidence. Exceptions to the time of forty
‑
five (45) days shall be made for accident and health insurance claims if there is any question as to the validity or the amount of the claim and the question is referred to the Wyoming state medical peer review committee for adjudication.
Exceptions shall also be made as authorized by W.S. 26
‑
16
‑
112(a).

26
‑
16
‑
112.

Payment of claims.

(a)

If the benefits under the policy are payable because of the death of the insured, settlement shall be made upon receipt of proof of death and, at the insurer's option, surrender of the policy or proof of the interest of the claimant, or both.
If an insurer shall specify a particular period prior to the expiration of which settlement shall be made, the period may not exceed the time requirements specified in W.S. 26
‑
15
‑
124. For any
private placement policy, settlement may be made in cash or, if allowed under the policy, by distributing assets of the separate account to the claimant with the consent of the policyholder, as long as the fair market value of the assets are independently verified at the time of disbursement by the insurer. In any private placement policy, the obligation of the insurer to settle that portion of the policy attributable to separate account assets is subject to the liquidity of the assets and the insurer shall settle the portion of the policy as and when the assets can be, by their respective terms, either converted to cash, which may be later than the time requirements specified in W.S. 26
‑
15
‑
124, or otherwise dispersible by the insurer.

(b)

Benefits shall be paid within the time requirements of W.S. 26
‑
15
‑
124 and shall include interest accrued from the date of death until date of payment. The interest rate shall be not less than the rate of interest payable on death proceeds left on deposit with the insurer.
For any private placement policy, the interest shall be computed commencing the latter of sixty (60) days succeeding the date of death of the insured or the date proof of death has been received by the insurer in good order, until the date of payment. In any private placement policy, the obligation of the insurer to pay interest on that portion of the policy attributable to separate account assets may only be computed as and when the assets are, by their respective terms, either converted to cash or otherwise dispersible by the insurer.

(c)

For purposes of this section, date of payment shall include the date of the postmark stamped on an envelope properly addressed and postage prepaid, containing the payment.

(d)

The provisions of this section requiring the payment of interest shall not apply to variable contracts which provide for insurance or annuity benefits which may vary according to the investment experience of any separate account or accounts maintained by the insurer as to such contract.

(e)

As used in this chapter, "private placement policy" is a variable life insurance policy that is:

(i)

Issued exclusively to a person who is an accredited investor or a qualified purchaser, as defined in the Securities Act of 1933 or the Investment Company Act of 1940 or in regulations promulgated under either statute; and

(ii)

Offered for sale and sold in a transaction that is exempt from registration under the Securities Act of 1933.

Section 2.

The provisions of this act shall apply to any life insurance policy delivered, issued for delivery or renewed in this state on or after July 1, 2020.

Section 3
.

This act is effective July 1, 2020
.

(END)

Speaker of the House

President of the Senate

Governor

TIME APPROVED: _________

DATE APPROVED: _________

I hereby certify that this act originated in the House.

Chief Clerk

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