Probes into insurer compliance with unclaimed property laws are escalating in some states.  As regulators get tougher on this issue, states are concerned about both state unclaimed property funds and promises to beneficiaries.  New York and Minnesota have recently begun in depth probes of insurers’ internal records and policies concerning the processing of death benefits.  Part of the continued probes focus on how far back (10 or up to 25½ years) records are checked and the software used.

These actions follow a previous determination in California that some insurers were using the death master file only to terminate annuity policies with living benefits features, and not to find beneficiaries of holders of life insurance policies that had died.