HB4979: PREPAID FUNERAL/BURIAL

Legislative Summary

Amends the Illinois Insurance Code. Provides that an insured or any other person who may be the owner of rights under a policy of life insurance may make an irrevocable assignment of all or a part of his or her rights under the policy to a funeral home in accordance with a specified provision of the Illinois Funeral or Burial Funds Act. Provides that a policy owner who executes a designation beneficiary form irrevocably waives and cannot exercise certain rights. Amends the Illinois Funeral or Burial Funds Act. In a provision concerning pre-need contracts funded through the purchase of a life insurance policy or tax-deferred annuity contract, provides that nothing shall prohibit the purchaser from irrevocably assigning ownership of the policy or annuity to a person or trust or from irrevocably assigning the benefits of the policy or annuity to a funeral home for the purpose of obtaining favorable consideration for Medicaid, Supplemental Security Income, or another public assistance program. Requires the insured or any other person who may be the owner of rights under an existing policy of life insurance to sign a guaranteed pre-need contract with the provider that describes the cost of the funeral goods and services to be provided upon the person's death, up to $7,248, except that any portion of a contract that clearly represents the purchase of burial space, as that term is defined for purposes of the Supplemental Security Income program, is exempt regardless of value. Provides that the form to effectuate the irrevocable assignment and thereby provide for the irrevocable designation of beneficiary of one or more life insurance policies shall be prepared by the Department of Healthcare and Family Services or such form, approved by the Department of Healthcare and Family Services, that has been prepared by an insurance company licensed to operate in the State of Illinois. Contains provisions concerning disclosure statements under pre-need contracts with cash advances; the distribution of proceeds under a life insurance policy upon the death of the insured; and other matters. Amends the Aid to the Aged, Blind or Disabled Article of the Illinois Public Aid Code. Provides that at any time prior to or after submitting an application for medical assistance and before a final determination of eligibility has been made, an applicant may use available resources to purchase one of the prepaid funeral or burial contracts exempted under the Article. Provides that existing life insurance policies are exempt if there has been an irrevocable assignment in compliance with a specified provision under the Illinois Funeral or Burial Funds Act. Requires a person to sign a contract with a funeral home, which is licensed under the Illinois Funeral or Burial Funds Act, that describes the cost of the funeral goods and services to be provided upon the person's death, up to $7,248, except that any portion of a contract that clearly represents the purchase of burial space, as that term is defined for purposes of the Supplemental Security Income program, is exempt regardless of value. Provides that the amount shall be adjusted annually for any increase in the Consumer Price Index. Requires the licensed funeral home to which the life insurance policy benefits have been irrevocably assigned to retain copies for inspection by the Comptroller and to report annually to the Comptroller certain information. Provides that certain provisions under the amendatory Act shall be subject to federal approval. Requires the Department of Healthcare and Family Services to apply for any necessary federal waivers or approvals to implement certain changes made under the amendatory Act. Effective immediately.