Amends existing law to revise provisions regarding notice of lapse or termination of individual life insurance.

LEGISLATURE OF THE STATE OF IDAHO
Sixty-eighth Legislature Second Regular Session - 2026
IN THE HOUSE OF REPRESENTATIVES
HOUSE BILL NO. 881
BY WAYS AND MEANS COMMITTEE
AN ACT	1
RELATING TO INSURANCE; AMENDING SECTION 41-1830, IDAHO CODE, TO REVISE PRO-	2
VISIONS REGARDING NOTICE OF LAPSE OR TERMINATION OF INDIVIDUAL LIFE IN-	3
SURANCE; AND PROVIDING AN EFFECTIVE DATE.	4
Be It Enacted by the Legislature of the State of Idaho:	5
SECTION 1. That Section 41-1830, Idaho Code, be, and the same is hereby	6
amended to read as follows:	7
41-1830. NOTICE OF LAPSE OR TERMINATION OF INDIVIDUAL LIFE INSUR-	8
ANCE. (1) Notwithstanding the provisions of section 41-1927, Idaho Code, an	9
individual life insurance policy shall not be issued or delivered in this	10
state until the applicant has been afforded the option of designating one (1)	11
person, in addition to the applicant, to receive notice of lapse or termina-	12
tion of a policy for nonpayment of premium.	13
(2) A designation made pursuant to subsection (1) of this section shall	14
be on the application or a form provided by the insurer. The applicant shall,	15
on such application or form, provide the full name, and address and telephone	16
number of the person designated to receive notice of lapse or termination of	17
the policy for nonpayment of premium.	18
(3) The insurer shall annually notify a policy owner of the right to:	19
(a) Make a designation pursuant to subsection (1) of this section;	20
(b) Change the designee; and	21
(c) Update the contact information of the designee.; and	22
(d) Make a request for notice by certified mail or commercial delivery	23
service at a potential cost to the policy owner not to exceed forty dol-	24
lars ($40.00) pursuant to subsection (6) of this section.	25
(4) The policy owner may, at the policy owner's discretion, change the	26
designee or change the contact information of the designee more often than	27
annually, and the insurer shall make available the form for such changes at	28
the policy owner's request.	29
(5) No individual life insurance policy shall lapse or be terminated	30
for nonpayment of premium unless the insurer, at least fourteen (14) sixty	31
(60) days prior to the effective date of the lapse or termination, sends no-	32
tice by first-class United States mail to the policy owner and to the policy	33
owner's designee, if a designation has been made pursuant to this section, of	34
the lapse or termination, at the address or addresses provided by the policy	35
owner for purposes of receiving such notice.	36
(6) In addition to the notice required pursuant to subsection (5) of	37
this section, the policy owner of an individual life insurance policy issued	38
with a face amount in excess of one hundred thousand dollars ($100,000) may	39
request that a lapse or termination notice be sent by United States postal	40
service certified mail, return receipt requested, or by a commercial deliv-	41

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ery service that provides written or electronic proof of signature required	1
delivery. If such a request is made:	2
(a) The request must be made to the insurer in writing at least ninety	3
(90) days prior to a lapse or termination;	4
(b) The insurer shall acknowledge the request in writing to the policy	5
owner, and such acknowledgement shall serve as verification that the	6
request was received;	7
(c) The notice of lapse or termination shall be sent at least sixty (60)	8
days prior to the effective date of the lapse or termination to the pol-	9
icy owner and, if a designation has been made pursuant to this section,	10
to the policy owner's designee at the address or addresses provided by	11
the policy owner for purposes of receiving such notice;	12
(d) The insurer may charge the policy owner the actual postage and de-	13
livery confirmation cost charged by the carrier for sending the notice	14
by certified mail or commercial delivery service, not to exceed forty	15
dollars ($40.00), and such amount may be added to the policy owner's	16
next premium payment;	17
(e) If the notice sent pursuant to this subsection is undeliverable or	18
refused, the insurer shall have no further obligation under this sub-	19
section; and	20
(f) In lieu of certified mail or commercial delivery service, an in-	21
surer may demonstrate proof of delivery for a lapse or termination	22
notice the insurer sends pursuant to this subsection by other methods	23
establishing delivery such as an electronic delivery read receipt,	24
provided that the policy owner making a request for notice by certified	25
mail or commercial delivery service is notified by the insurer at the	26
time of the request that an alternative method establishing delivery	27
will be used.	28
(6) (7) The provisions of this section shall apply prospectively to any	29
individual life insurance policy issued or in force on or after January 1,	30
2018 2027. Provided however, that the provisions of this section do not ap-	31
ply to any life insurance policy under which premiums are payable monthly or	32
more frequently.	33
SECTION 2. This act shall be in full force and effect on and after Jan-	34
uary 1, 2027.	35

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