HF 2794

as introduced - 87th Legislature (2011 - 2012) Posted on 03/12/2012 01:55pm

A bill for an act
relating to insurance; requiring refund of premiums paid on life insurance
policies in certain circumstances; proposing coding for new law in Minnesota
Statutes, chapter 61A.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [61A.75] LIFE INSURANCE PREMIUM REFUND.
new text end

new text begin (a) If a life insurance policy is deemed to be void, void ab initio, or otherwise
terminated or extinguished in accordance with the law on grounds other than nonpayment
of premium, the owner of the policy or its designated representatives has the right to
recover from the insurer all premiums paid on the policy plus any interest on those
payments at the rate set in section 549.09, subdivision 1, paragraph (c), clause (2).
new text end

new text begin (b) If a life insurer refuses to state that it will not contest the policy for lack of
insurable interest, as defined in section 60A.0783, subdivision 2, within 120 days of receipt
of a verification of coverage request from the policyholder or its designated representative
that was submitted to the insurer more than two years from the date of issuance of the
policy, the owner of the policy has the right to a judicial declaration as to the validity of the
policy by bringing an action in district court. If the court determines that the life insurance
policy is valid, the insurer shall pay the cost of the action, including attorney fees.
new text end

new text begin (c) This section does not apply to the owner of a life insurance policy who engaged
in fraud in connection with the issuance of the policy.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment
and applies to life insurance policies in effect on or issued on or after that date.
new text end