The proposed bill would update current statutes related to life insurance policy forms and illustrations by introducing new definitions and requirements aimed at enhancing consumer protection and transparency. It would define "illustration" as a presentation that includes non-guaranteed elements of a life insurance policy over a period of years and require insurers to notify the Director of the Department of Insurance and Financial Institutions (DIFI) regarding whether a policy form will be marketed with or without an illustration. The bill would also mandate that a basic illustration be prepared and delivered in accordance with state law for policies marketed with an illustration, and establish detailed content and format requirements for these illustrations, including narrative and numeric summaries of benefits and disclosures about guaranteed and non-guaranteed elements. Additionally, the bill would classify violations of these illustration requirements as unfair trade practices and define "illustrated scale" to ensure that the scale of non-guaranteed elements is not more favorable than the lesser of either the disciplined current scale or the currently payable scale. It would also introduce new obligations for insurers regarding the delivery and retention of illustrations, including annual reports to policyholders and the certification of illustrated scales by illustration actuaries. Overall, these updates aim to strengthen regulatory oversight and ensure that consumers receive accurate and comprehensive information about their life insurance policies.

Statutes affected:
Senate Engrossed Version: 20-1241, 20-431.08, 20-431.01, 20-431.02, 20-431.03, 20-431.04, 20-431.05, 20-431.06, 20-431.07, 20-431.09, 20-442
Chaptered Version: 20-1241, 20-431.08, 20-431.01, 20-431.02, 20-431.03, 20-431.04, 20-431.05, 20-431.06, 20-431.07, 20-431.09, 20-442