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New California law empowers life insurance beneficiaries

01/04/12

California has enacted a new law that will protect beneficiaries included in life insurance policies at a time when the federal government continues to seek measures that would boost disclosures for survivors of its employees.

According to Bloomberg, insurers in the Golden State must now obtain written declarations from beneficiaries before directing their settlements to in-house accounts. Survivors will then have the power to decide for themselves whether or not to keep their money with the insurers in a retained-asset account or receive the benefits in one large sum.

"That's an essential consumer protection," Birny Birnbaum, executive director of the Center for Economic Justice, a consumer group, told the news source. "Commissioner Jones really took the lead in pushing a lot of this stuff."

The U.S. Government Accountability Office has pushed for greater regulation of RAAs and recently called on the U.S. Office of Personnel Management to be more transparent in sharing information with beneficiaries of federally-sponsored life insurance plans, according to Bloomberg.


Consumers in California and elsewhere across the United States are encouraged to purchase life insurance coverage in some form, especially if they have dependents or loved ones who rely on their financial contributions. Comparing life insurance quotes online is the easiest way to find affordable policies.

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