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PRINTER'S NO. 2863
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No.
1996
Session of
2018
INTRODUCED BY BERNSTINE, BARRAR, MURT, WARD, IRVIN, SIMMONS,
DRISCOLL, GILLEN, D. COSTA, WATSON, HEFFLEY, TOEPEL, PYLE,
HAGGERTY, MILLARD, RAPP, HELM, D. MILLER AND PHILLIPS-HILL,
JANUARY 5, 2018
REFERRED TO COMMITTEE ON INSURANCE, JANUARY 5, 2018
AN ACT
Amending Title 40 (Insurance) of the Pennsylvania Consolidated
Statutes, in general provisions, providing for limitation on
payment due to furtherance of terrorism.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Title 40 of the Pennsylvania Consolidated
Statutes is amended by adding a section to read:
§ 102. Limitation on payment due to furtherance of terrorism.
(a) Beneficiaries.--Notwithstanding a provision in an
insured's policy or contract, the following shall govern the
receipt of proceeds under the deceased insured's policy or
contract, based on the availability of proceeds payable under
the policy or contract:
(1) Payments to a beneficiary shall be limited to the
amount of premiums that have been paid to the insurer under
the policy or contract if the insured's death occurs directly
or indirectly as a result of the insured's furtherance of
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terrorism.
(2) Each victim of the insured's furtherance of
terrorism shall receive the proceeds first on a proportional
basis. If a victim is deceased as a result of the insured's
furtherance of terrorism, the individual or individuals
entitled to the victim's estate under the intestate laws of
this Commonwealth shall receive the victim's share of the
proceeds.
(3) The determination of whether an individual is a
victim under this section shall be made in coordination with
the Pennsylvania Victims Compensation Assistance Program.
(b) Definitions.--As used in this section, the following
words and phrases shall have the meanings given to them in this
subsection unless the context clearly indicates otherwise:
"Beneficiary." A person designated to receive the proceeds
from a policy or retained asset account.
"Contract." An annuity contract. The term shall not include
an annuity used to fund an employment-based retirement plan or
program where:
(1) the insurer does not perform the recordkeeping
services; or
(2) the insurer is not committed by terms of the annuity
contract to pay death benefits to the beneficiaries of
specific plan participants.
"Insured." An individual covered by a policy or contract.
"Insurer." A person licensed in this Commonwealth to sell
policies or contracts as any of the following:
(1) A single insurance entity.
(2) An insurer under a parent organization that sells
annuities using a different charter.
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"Policy." A policy or certificate of life insurance that
provides a death benefit. The term shall not include any of the
following:
(1) A policy or certificate of life insurance that
provides a death benefit under an employee benefit plan
subject to the Employee Retirement Income Security Act of
1974 (Public Law 93-406, 88 Stat. 829) or under a Federal
employee benefits program.
(2) A policy or certificate of life insurance that is
purchased in conjunction with a preneed funeral contract or
prearrangement.
(3) A policy or certificate of credit life or accidental
death insurance.
(4) A policy issued to a group master policyholder for
which the insurer does not provide recordkeeping services.
"Recordkeeping services." Services performed by an insurer
for obtaining, maintaining and administering, in the system of
the insurer or the insurer's agents, at a minimum, the following
information about each insured under the insured's contract or a
line of coverage under the contract:
(1) Social Security number or name and date of birth.
(2) Beneficiary designation information.
(3) Coverage eligibility.
(4) Benefit amount.
(5) Premium payment status.
"Retained asset account." A mechanism whereby the settlement
of proceeds payable under a policy or contract is accomplished
by the insurer or an entity acting on behalf of the insurer
depositing the proceeds into an account with check or draft
writing privileges, where those proceeds are retained by the
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insurer or the insurer's agent, pursuant to a supplementary
contract not involving annuity benefits other than death
benefits.
"Terrorism." As described under 18 Pa.C.S. § 2717 (relating
to terrorism).
Section 2. This act shall apply to a policy or contract
delivered or issued for delivery before, on or after the
effective date of this act.
Section 3. This act shall take effect in 60 days.
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