The proposed bill would update current statutes related to life insurance policy illustrations by introducing new definitions and requirements aimed at enhancing consumer protection and transparency. It would define terms such as "illustration," "basic illustration," and "illustrated scale," while mandating that insurers notify the Director of the Department of Insurance and Financial Institutions (DIFI) regarding the marketing of policy forms with or without illustrations. The bill would require that if a policy form is marketed with an illustration, a basic illustration must be prepared and delivered, including specific content and format requirements such as narrative summaries and numeric summaries of benefits. Additionally, it would establish guidelines for supplemental illustrations and prohibit misleading representations.

Furthermore, the bill would impose annual reporting requirements on insurers, necessitating detailed information on policy performance and changes in non-guaranteed elements. It would require insurers to appoint illustration actuaries to certify compliance with actuarial standards and ensure that illustrations meet statutory requirements. The bill also introduces new obligations for insurance producers to certify in writing when an illustration is not used and mandates that policyowners receive annual reports detailing their policy status. Overall, these updates aim to strengthen regulatory oversight and clarity in life insurance practices, with the changes set to take effect on January 1, 2026.

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