Illinois treasurer sets hearings on life insurance practices

SPRINGFIELD, Ill. (AP) — Illinois Treasurer Michael Frerichs is launching a series of public hearings to explore how life insurance companies avoid paying death benefits.

The first hearing is set for Wednesday morning in the city council chambers in Normal.

The state treasurer’s office said Monday it has identified more than $550 million in unpaid death benefits owed to families in Illinois and that $7.4 billion has been identified nationally.

Frerichs supports legislation to require insurers to use federal death records to identify deceased policyholders whose life insurance proceeds remain unpaid. The bill awaits Gov. Bruce Rauner’s signature. A spokeswoman for the governor says the bill is under review.

Three affiliated life insurance companies are suing Frerichs to block an audit that would show if they are holding onto insurance benefits of deceased policyholders.