For purposes of this article:

(a) “Annuity contract” does not include an annuity used to fund an employment-based retirement plan or program if either of the following applies:

(1) The insurer does not perform the recordkeeping services.

(2) The insurer is not committed by the terms of the annuity contract to pay death benefits to the beneficiaries of specific plan participants.

(b) “Asymmetric conduct” means an insurer’s use of the Death Master File before July 1, 2020, solely for purposes other than determining whether one of its insureds may be deceased in order to locate and pay beneficiaries.

(c) “Beneficiary” or “beneficiaries” means the person or persons entitled or contingently entitled to receive the proceeds from a policy, an annuity contract, or a retained asset account.

(d) “Death Master File” means the United States Social Security Administration’s Death Master File or any other database or service that is at least as comprehensive and accurate as the United States Social Security Administration’s Death Master File for determining that an individual has reportedly died.

(e) “Death Master File match” means a search of the Death Master File that results in a match of the social security number, individual taxpayer identification number, or name and date of birth of an insured that is made and validated in accordance with the requirements of subdivision (a) of Section 10509.944.

(f) “Insured” means an individual identified in a policy, retained asset account, or annuity contract whose death obligates the insurer to pay benefits or proceeds to a beneficiary or beneficiaries.

(g) “Knowledge of death” means any of the following:

(1) Receipt of an original or valid copy of a certified death certificate.

(2) A Death Master File match.

(3) Any other information in an insurer’s records from which the insurer should know that the insured has died.

(h) “Lapse” means the termination of a policy resulting from nonpayment of premiums or, in the case of variable life and universal life insurance policies, the depletion of cash value below the amount needed to keep the policy in force.

(i) “Policy” means a policy or certificate of life insurance that provides a death benefit. “Policy” does not include any of the following:

(1) A policy or certificate of life insurance that provides a death benefit under an employee welfare benefit plan subject to the federal Employee Retirement Income Security Act of 1974 (ERISA) for which the insurer does not provide recordkeeping services, or under any federal employee benefit program.

(2) A funeral insurance contract, as defined in Section 10240.

(3) A policy or certificate of credit life insurance as defined in Section 779.2.

(4) An accidental death or health policy, rider, or certificate, including, but not limited to, a disability or long-term care policy, rider, or certificate.

(5) A joint and survivor annuity contract, if an annuitant is still living.

(6) A policy issued to a group master policyholder for which the insurer does not provide recordkeeping services.

(j) “Recordkeeping services” means circumstances under which an insurer has agreed with a group life insurance policyholder or contractholder to be responsible for obtaining, maintaining, and administering, in its own or its agents’ systems, at least all of the following information about each individual insured under an insured’s group insurance contract or a line of coverage:

(1) Social security number, individual taxpayer identification number, or name and date of birth.

(2) Beneficiary designation information.

(3) Coverage eligibility.

(4) Benefit amount.

(5) Premium payment status.

(k) “Records” means information regarding policies, annuity contracts, and retained asset accounts maintained in an insurer’s administrative systems or the administrative systems of a third party retained by the insurer. “Records” does not include information regarding policies, annuity contracts, and retained asset accounts maintained by a group life insurance policyholder or contractholder, or information that has been deleted from an insurer’s administrative system consistent with this act and the insurer’s record retention and destruction policies.

(l) “Retained asset account” means a mechanism whereby the settlement of proceeds payable under a policy or individual annuity contract, including, but not limited to, the payment of cash surrender value, is accomplished by the insurer or an entity acting on behalf of the insurer establishing an account with check or draft writing privileges, if those proceeds are retained by the insurer, pursuant to a supplementary contract not involving annuity benefits.

(m) “Retained asset accountholder” means the owner of a retained asset account or other person to file a claim for, or otherwise receive proceeds in accordance with the terms of, the retained asset account.

(n) “Thorough search” means reasonable and good faith efforts, documented by an insurer, to identify a beneficiary, determine a current address for the beneficiary, and contact the beneficiary.

(Added by Stats. 2019, Ch. 286, Sec. 1. (SB 740) Effective January 1, 2020.)