NAIC Forms RAA Panel

"We want consumers to have as many choices as possible in how they receive their claims payments, but we also want to make certain the terms of those payments are fully disclosed in language that is clear and easy to understand," Cline says.

While the working group is looking at RAA consumer issues, another arm of the NAIC, the Financial Condition Committee, will address RAAs by considering changes in life product reporting requirements, Cline says.

RAAs are special accounts life insurers use to hold beneficiaries' benefits until the beneficiaries withdraw the cash using checks, payment cards or other means.

Critics say life insurers earn high returns on the cash and pay beneficiaries low rates without giving the beneficiaries adequate notice that the cash is held in something other than a bank account insured by the Federal Deposit Insurance Corp. (FDIC).

Supporters say RAAs give grieving beneficiaries a chance to deal with their emotions before addressing financial concerns, and that funds guaranteed by an insurer may be safer than bank deposits insured by the FDIC.