OLR Bill Analysis
AN ACT PROHIBITING CERTAIN LIFE INSURANCE POLICY EXCLUSIONS FOR ACTIVE MEMBERS OF THE ARMED FORCES AND THE NATIONAL GUARD.
This bill codifies existing Insurance Department regulations that generally prohibit issuing or delivering a life insurance or annuity policy, contract, or certain related documents to anyone known to be an armed forces member that eliminates or otherwise reduces an insurer's liability if the insured's injury or death results from war (also known as war-risk exclusion clauses) (Conn. Agencies Reg. § 38a-819-74(h)(5)).
Under the bill, a policy, contract, and any related application, rider, or endorsement cannot exclude coverage if the insured's death is related to (1) a declared or undeclared war or (2) any act related to military service. But the bill allows them to exclude accidental death coverage such as double indemnity (i.e., paying a multiple of the policy's value if death results from an accident).
The bill applies to documents issued or delivered to anyone known to be an active or reservist member of the Army, Navy, Marine Corps, Coast Guard, Air Force, or active National Guard member.
EFFECTIVE DATE: October 1, 2015
Insurance and Real Estate Committee