Frerichs fights for more access to death benefits

Aug. 26--DECATUR -- It was tough on Sherry Mayberry when her mother died.

But seven years later, Mayberry discovered her mother had a life insurance policy with thousands of dollars that had gone unclaimed.

"I had a cousin that was reading the newspaper, and the (treasurer office's) I-Cash program was in there," said Mayberry. "So they called me and said, 'Hey, I saw your name and there's money coming your way. You should check it out.'"

Mayberry's story is one that has been heard a lot recently by Illinois Treasurer Michael Frerichs as he has toured the state with the Task Force on Unclaimed Life Insurance Policies. It is meant to draw attention to the hundreds of millions of dollars of death benefits left unclaimed by families and how insurance companies have no prerogative to contact beneficiaries.

"(Insurance companies) say they cannot know when someone has died unless someone approaches them with a death certificate," Frerichs said. "But we just know that is not true."

Part of the task force's purpose for visiting Richland Community College on Thursday morning was to raise awareness for the proposed Unclaimed Life Insurance Benefits Act. The proposal would require insurance companies to check a national Social Security database to determine whether policyholders have died and to make a good-faith effort to locate their beneficiaries. The plan passed the General Assembly with minor opposition and is awaiting action from Gov. Bruce Rauner. A spokeswoman for Rauner said the bill is under review.

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Audits conducted by the treasurer's office have identified $550 million in death benefits that were never paid to Illinois families over the past five years. Those audits only cover 20 of the nation's largest insurers that committed to doing so as part of a national settlement with state authorities. Frerich said there could be hundreds of millions more at other companies that were not audited.

There were about a dozen people at the start of Thursday's hearing, which was overseen by Frerichs and included representatives from the AARP, Citizen Action Illinois, state Rep. Sue Scherer, D-Decatur, and state Sen. Sam McCann, R-Plainview, with the latter praising the hearings as a chance for residents to learn about the issue and present their own stories.

"This is what open and honest government is all about," McCann said.

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