A guide for tracking and reporting unclaimed property specific to the insurance industry.
For other types of unclaimed property that apply to your business, please refer to our
Unpresented Checks Guide and our Stocks, Bonds and Employee Benefits Guide.
Property and Casualty
Drafts covered by the Drafts not covered by the
Unclaimed Property Law Unclaimed Property Law Auditor’s Tips
According to the Uniform Unclaimed The Uniform Unclaimed Property Act Tip One: Don’t assume that all drafts
Property Act, drafts that are not offers does not apply to a draft issued as an are offers to settle. To simplify the
to settle are considered abandoned offer to settle a claim. Drafts written reporting process, develop a method
after three years and need to be to third parties to settle damages or to track unpresented drafts that are
reported. that limit future claims are considered offers to settle or were settled by
Drafts for goods and services are offers to settle and are not covered subsequent drafts or other means.
generally not offers to settle. Examples under the act. Examples include: These drafts are easier to track
include: • Payments for pain and suffering because there are fewer and the
amounts are often large. Remove
• Drafts issued for furniture • Third party personal injury those from your unpresented
and supplies claim payments drafts to determine your reporting
• Drafts issued for copy responsibilities
Tip Two: To prevent the need for
• Drafts sent to an ambulance service estimating your claims draft liability
for a third party in an audit, keep claims files while an
First party drafts (drafts representing offer to settle remains open. Retain
policy obligations to the insured) files on drafts offered in settlement
are included in unclaimed property for six years after the claim file
reporting. First party drafts which are is destroyed. While estimates are
not offers to settle include: permitted under RCW 63.29.300(5),
it is preferable to have names and
• Insured’s car repair bill
addresses to return money to citizens.
• Medical expenses
Life Insurance Proceeds Policyholders Dividends IRAs Plans
Items subject to the unclaimed Report payable dividends under Traditional IRA Plans
property statute include: participating policies after three years. The mandatory payout age for
• Death benefits Policy dividend options can not be traditional individual retirement
changed without the policyholder’s accounts (IRAs) is 70 ½. If you are
• Funds payable to policyholders authorization. unable to contact the owner, the
reaching the limiting age
Auditor’s Tip unclaimed IRA is abandoned three
• Matured endowments years after the mandatory payout date.
You must have a contractual right
• Annuities to change the dividend application Roth IRA Plans
• Other maturities due or payable option. Written notice must be Roth IRAs are payable when an owner
Most life insurance proceeds are mailed to the policyholder. Auditors reaches 59 ½. If you do not have
considered abandoned three years after usually review policies with a dividend contact with the owner, Roth IRAs are
becoming payable. Exception: Two years reinvest option that was changed abandoned three years after the owner
after the insured reaches the limiting from a cash dividend option. reaches 59 ½.
age on the policy’s mortality table, the
proceeds are considered abandoned. Agent’s Credit Balances/
Required administrative duties: Commissions
1. If you are required to give notice Agent commissions are abandoned
to the insured that a non-forfeiture after three years unless the agent is an
provision is being exercised, and the employee of the company. Employee
notice cannot be delivered to the last commissions are abandoned after one
known address, you must make year. (RCW 63.29.020).
a reasonable search to determine
the correct address. Auditor’s Tip
Renewal commissions are prone to
2. If you learn of the death of the the following reporting errors:
insured or annuitant, and the
beneficiary has not communicated to • Ceasing or reducing renewal
you within four months of the death, commission in violation of the
you must take reasonable steps to agreement with the agent.
pay the proceeds to the beneficiary. • Imposing the current contract
3. You must request the name, procedures on agents covered
address and relationship to insured, under older agreements.
of each beneficiary on each • Writing off to income or expense
change of beneficiary form issued old lump-sum liabilities where the
by the insurance company for a agent detail is lost.
Unclaimed Property Because this is a summary, it does To inquire about the availability of
Contact Information not contain all the information that
may be important to you. For more
this publication in an alternate format
for the visually impaired, please call
Main Phone: (360) 705-6706 information, please refer to Chapter (360) 705-6715.
(Press “0" for assistance) 63.29 of the Revised Code of
Teletype (TTY) users please call
Toll Free: 1-800-435-2429 Washington.
(Washington State only) 1-800-451-7985.
Fax: (360) 586-2163 Permission is granted to other state
E-mail: email@example.com governments to use and modify this
material to their particular needs
Mail: Washington State
Department of Revenue and laws. This publication, or any part
Unclaimed Property Section thereof, may not be reproduced or
PO Box 47489 transmitted in any form or by any Prepared by the Taxpayer Services Division
Olympia, WA 98504-7489 means for a fee or for the purposes Printed on recycled paper
of profit-making activities. UPGD0006 3/08