Section 408:10-a Interest Payment on Life Insurance Death Benefits.
I. Notwithstanding any other provision of law, any life insurance company doing business in this state which fails or refuses to pay the proceeds of, or payments under, any individual or group policy of life insurance issued by it within 30 days after the date of death of the insured shall pay interest, at a rate of interest currently paid by the insurer on proceeds left under the interest settlement option, computed from the date of the insured's death, on any moneys payable and unpaid after the expiration of such 30-day period. This section shall apply only to deaths of insureds which occur on or after January 1, 1986.
II. Nothing in this section shall be construed to allow any life insurance company doing business in this state to withhold payment of money payable under a life insurance policy to any beneficiary for a period longer than reasonably necessary to transmit such payment. Whenever possible, payment shall be made within 30 days after the date of death of the insured.
III. In any case in which interest on the proceeds of, or payments under, any individual or group policy of life insurance becomes payable pursuant to paragraph I, the insurer shall notify each named beneficiary at the last known address that interest will be paid on the proceeds of, or payments under, such policy from the date of death of the named insured if the company does not pay the proceeds of, or payments under, the policy within 30 days of the insured's death. Such notice shall specify the rate of interest to be paid.
IV. This section shall not require the payment of interest in any case in which the beneficiary elects in writing delivered to the insurer to receive the proceeds of, or payments under, the policy by any means other than a lump sum payment.
Source. 1985, 224:1. 1995, 112:1, 2, eff. May 16, 1995.