New legislation would limit life insurance payouts to terrorists’ families, ensure victim compensation

New legislation would limit life insurance payouts to terrorists’ families, ensure victim compensation

Author: Jason Gottesman/Thursday, January 4, 2018/Categories: News and Views

Legislation recently introduced by Rep. Aaron Bernstine (R-Lawrence) seeks to limit the amount of life insurance due to beneficiaries of terrorist policyholders and provide some compensation to victims out of the proceeds of those same life insurance benefits.


The bill, House Bill 1996, would allow insurance companies to limit payouts on life insurance policies purchased by individuals who died while carrying out acts of terrorism by limiting payments to named beneficiaries to only the amount of the premium paid by the insured to the insurer.


In addition, the legislation seeks to ensure victim compensation by allowing victims of the act of terror to receive proportional proceeds from the insured’s life insurance policy in coordination with the Pennsylvania Victims Compensation Assistance Program.


“Currently, a terrorist can take out a large life insurance policy during the planning process of their horrific crimes to benefit their heirs or their families, such was the case with the 2015 San Bernardino attack,” Rep. Bernstine said about the need for his legislation.


“To me, it’s a no-brainer that victims and their families are the ones who should be getting that money.”


While the legislation has been informally circulating since September 2017, Rep. Bernstine said he was motivated to push for the formal introduction of the bill after a December 22, 2017, incident in Harrisburg that some federal authorities have said may be linked to terrorism.


In that incident, a man with connections to the Middle East purposefully targeted Capitol Police and Pennsylvania State Police officers in a Capitol-area shoot out that ultimately led to the perpetrator’s death.


One State Police trooper was injured in the incident.


“I am grateful for our exceptional Capitol Police and all of the men and women in uniform who quickly got that situation under control in Harrisburg,” Rep. Bernstine added.


“While state government might not be able to stop these types of events from taking place, we can certainly make sure there are no financial incentives available for terrorism.”


As of Thursday, the legislation has not been formally referred to a standing committee for potential consideration.