If you are an owner, insured, beneficiary, or prospective buyer of life insurance in the state of Illinois, there are rights pertaining to your policy that could be very important to you.
Life Insurance Rules And Regulation In Illinois
Life insurance is regulated under Title 215 in the state of Illinois statutes. This regulation is in place to protect both policy holders and insurance companies from unscrupulous behavior.
Illinois residents are entitled to a 30 day grace period. During this period of time, which starts after a missed due premium payment, a policy holder will still have coverage. Even though payment was not made on the due date, if an insured dies during the grace period the life insurance company is required to pay a death claim, as long as it is a valid claim. This prevents an insurance company from denying a claim for a slightly overdue payment. This also keeps a policy in force for the insured, to prevent the need to go through a new application process and the underwriting involved.
Illinois residents are given a minimum free look period of 10 days, which is the most common minimum length of time mandated by states. Your free look period starts upon delivery of the life insurance policy. During this time the owner may return the policy and be given a full refund by the insurance company of any money paid. An insurance company can not charge any fees for a policy being “free looked”.
Guarantee Of Death Claim Payment And Cash Value
To inspire trust and help prevent innocent policy holders from being defrauded by life insurance companies who are not practicing sound financial management, the Illinois Life and Health Insurance Guaranty Association will back the cash value of your policy up to $100,000, and the death benefit of your policy up to $300,000. This limit applies per person, and is not affected by the number of policies owned or the size of the policies in excess of these amounts.
Timely Payment Of Claims
Illinois requires that life insurance companies quickly settle and pay out all claims. To help prevent delays, if a claim takes more than 30 days to be paid in Illinois the insurance company must not only pay the claim, but interest as well. Interest starts accruing immediately after 30 days.
Medical Information Privacy
All medical information in Illinois is considered private and may not be shared without permission. Illinois deems this to be so private, in fact, they you may not even compel the insurance company to share the results of their underwriting directly with you. They are required, though, to share this information with a doctor of your choosing if you so wish.
Illinois Department of Insurance
Illinois Life & Health Insurance Guaranty Association
8420 W. Bryn Mawr Avenue, Suite 550
Telephone: 773-714-8050Chicago, IL 60631-3404