I previously posted about new class actions against life insurance companies alleging that they should be required to determine whether their insureds have died where no claim for policy proceeds has been made, through searching the “Death Master File” of the Social Security Administration. I raised a number of issues about the viability of these cases, and have not seen any court decisions on that yet. But in the meantime, a posting on the Life Insurance Compliance & Regulation Law Blog alerted me to a press release issued by the New York Insurance Department, indicating that it has issued letters to insurers instructing them to check the “Death Master File” and take steps to ascertain if policy proceeds are due, as well as provide certain documents to the department. The department indicates it is working on a formal regulation on this issue.
This regulatory action in New York may result in more class action filings on this issue, and life insurers may want to take a look at what they are doing on this issue nationwide. Although there has not even been a formal regulation and it is unlikely that such a regulation could be made retroactive, I would expect plaintiffs’ attorneys to try to argue that life insurers should have been doing this all along now that an insurance department in a prominent state has taken action. Whether this issue has any legs as a class action, given the issues raised in my prior post (among others) remains to be seen.