Friday is the deadline for Illinois Gov. Bruce Rauner to act on the proposed Unclaimed Life Insurance Benefits Act.
The legislation, spearheaded by Illinois Treasurer Mike Frerichs, passed unanimously in the Illinois General Assembly.
It would require life insurance companies to check their records against the national death database to identify policyholders who have died. The insurance companies would have to ensure beneficiaries of the dead policyholders are contacted and paid their benefits.
The Illinois Treasurer's office, through an audit, has uncovered $550 million in unclaimed life insurance benefits since 2011, prompting Frerichs to push for the legislation.
Business groups, however, are urging Rauner to veto the bill. The U.S. Chamber of Commerce's Institute for Legal Reform is among the opponents, claiming that the legislation "will likely increase the problem of overreaching audits that are frequently conducted on behalf of states by private audit firms hired under contingency fee arrangements."
"The explosion of irrational unclaimed property enforcement audits is often driven by profit-motivated private audit firms, and these audits have become a national concern for American businesses," the group added in a recent letter to Rauner.
The treasurer's office has pushed back on the opposition. The measure would make the audits less necessary because "insurance companies would start doing themselves what we have auditors do now," a Frerichs spokesman told Crain's Chicago Business.
UPDATE (2:52 p.m.): The governor signed the Unclaimed Life Insurance Benefits Act, which takes effect in January.