The proposed bill would significantly update current statutes related to life insurance policy forms and illustrations by introducing new definitions and requirements. 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 summaries and numeric summaries of benefits. Additionally, it would remove any existing provisions that do not align with these new requirements to ensure consistency and transparency for consumers. Further updates include new provisions that classify violations of illustration requirements as unfair trade practices, enhancing regulatory oversight. The bill would introduce new definitions for terms such as "actuarial standards board," "basic illustration," and "illustration actuary," and require insurers to provide annual reports to policyholders detailing their policy status. It also specifies that a basic illustration must be provided to enrollees of nonterm group life insurance policies and mandates that insurers retain copies of illustrations and certifications for three years after a policy is no longer in force. Overall, these changes aim to improve consumer protection and ensure that policyholders receive clear and accurate information about their life insurance products.

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