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SB 1070

Occupations: mortuary science; references to article 18 of the occupational code in the insurance code of 1956; revise. Amends sec. 2080 of 1956 PA 218 (MCL 500.2080). TIE BAR WITH: SB 1060'26

2025-2026 Regular Session Introduced by Kevin Hertel and 3 co-sponsors

SB 1070 tightens regulation of using life insurance proceeds for funeral/cemetery services, caps assignments, requires clear disclosures, and blocks insurers from owning funeral bu

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Bill Summary · SB 1070

Overview

  • Bill: SB 1070
  • Session: 2025-2026
  • Jurisdiction: Michigan
  • Topic: Occupations related to mortuary science; references to article 18 of the occupational code in the Michigan Insurance Code; revise. Ties to SB 1060.
  • Status: Introduced June 23, 2026; referred to the Regulatory Affairs Committee. Co-sponsors include Sylvia Santana, Michael Webber, Kevin Hertel, and Roger Victory.

Main purpose and intent

SB 1070 amends the Michigan Insurance Code (1956 PA 218, as amended) to tighten and clarify the regulation of funeral establishments, cemetery services, and the use of life insurance proceeds or annuities to pay for funeral or cemetery goods and services. The bill aims to:
- Prevent life insurers from directly owning or operating funeral establishments and limit insurance producers’ involvement with funeral-related activities.
- Regulate arrangements where proceeds of life insurance policies or annuity contracts are assigned to funeral homes, cemeteries, or sellers as payment for funeral or cemetery services.
- Establish strict conditions and disclosures for assignments, including caps on the amount assignable, price disclosures, dispute resolution processes, and consumer protections.
- Ensure that associated or nonassociated life insurance policies used to fund funeral or cemetery services comply with specified rules, including limits on death benefits and required disclosures.

Note: The bill’s enactment is contingent on the passage of SB 1060.

Key provisions and changes

  • Sec. 2080(1): Prohibits a life or accident insurer authorized in Michigan from owning, managing, supervising, operating, or maintaining a funeral establishment, and from allowing its officers, agents, or employees to own or maintain one.
  • Sec. 2080(2): Generally prohibits contracts where a life insurer or similar company would arrange that a funeral director or mortuary conducts the funeral for a person insured by the insurer (with stated exceptions).
  • Sec. 2080(3): Establishes licensure rules for funeral establishments, cemeteries, or sellers acting as limited life insurance producers. Limited producers may sell only associated life insurance policies or annuities and must meet strict conditions (including disclosures, annual lists of insurers, and restrictions on selling cemetery/funeral goods).
    • Limited producers cannot sell cemetery or funeral goods/services unless conditions in subsection (9) are met.
    • Funeral establishments may inform customers about life insurance and provide forms and a director-prepared list of Michigan-associated life insurance policies or annuities.
    • Any price assignment must be based on a life insurance policy or annuity, with required disclosures about potential price increases and limitations.
  • Sec. 2080(4)-(5): Prohibit certain arrangements where beneficiaries or assigned proceeds are used to secure or direct cemetery/funeral services, or where goods/services are provided in exchange for policy proceeds or assignments (with limited exceptions).
  • Sec. 2080(6): Allows life insurers to write policies or annuities that are assignable to payment for cemetery/funeral services, but with a detailed, written assignment process and numerous conditions:
    • Assignments must be written on a director-approved form.
    • Predeath assignments are void unless conditions are satisfied (per-subsection checks a–m), including revocability, price disclosures, constraints on price increases, and limits on death benefits.
    • Maximum assignment amounts: $12,720 (adjusted annually with CPI) for both associated and nonassociated policies, with annual CPI-based adjustment.
    • The assignment must be limited to the portion needed to cover the contracted cemetery or funeral services.
    • Requires an annual price list and compliance with FTC price-disclosure rules.
    • Provides for dispute resolution rights and arbitration processes (AAA rules) if disputes arise.
  • Sec. 2080(7)-(12): Adds enforcement and penalties:
    • Authorized actions in circuit court to enforce compliance with subdivision (6) and to obtain damages or injunctions.
    • Misdemeanor penalties up to $1,000 fine or 6 months imprisonment per violation; ability to impose civil fines up to $10,000 per violation via director after due process.
    • Funds collected go to the Funeral Consumers Education and Advocacy Fund to educate consumers and provide legal assistance for violations.
  • Sec. 2080(13)-(14): Definitions related to the section:
    • Defines “Associated life insurance policy or annuity contract,” “Funeral establishment,” “Funeral services,” “Funeral goods,” “Cemetery goods,” “Cemetery services,” “Limited death benefit,” and other terms.
    • Clarifies when a life insurance producer is considered associated with a funeral establishment, cemetery, or seller.
    • Defines terms like “Consumer Price Index,” “Nonassociated life insurance policy,” “Representative of the insured’s estate,” and “Seller.”
  • Subsection (9) and (10): Additional consumer-protection and disclosure requirements for producers and the handling of assignments, including conditional disclosures about associations, prepaid contracts, escrow arrangements, and cancellation refunds.

Affected parties and impacts

  • Funeral establishments, cemeteries, and sellers: Subject to licensing constraints, prohibitions on certain ownership/association arrangements, and strict assignment processes for proceeds used to fund funeral or cemetery services.
  • Life insurers and life insurance producers: Bound by prohibitions on owning funeral businesses, limited licensure pathways (limited life insurance producers), required disclosures, and financial/assignment restrictions.
  • Consumers/insureds and their estates: Greater protections around the sale and assignment of policy proceeds to fund funeral or cemetery services; explicit dispute-resolution procedures and consumer disclosures; price protection mechanisms and potential refunds if contracts are canceled.
  • The state regulator (Director): Receives new rulemaking responsibilities, enforcement authority, and administration of the Funeral Consumers Education and Advocacy Fund.

Procedural and timeline aspects

  • Enactment condition: SB 1070 requires SB 1060 to be enacted into law before SB 1070 takes effect (enacting section states clear dependency).
  • Effective date: Tied to the enactment of SB 1060; no separate effective date specified within SB 1070 itself.
  • Enforcement and penalties: Establishes a framework for civil and criminal penalties, with regulatory funds directed to consumer education and advocacy.

Summary

SB 1070 strengthens regulatory separation between life insurers and funeral/cemetery service providers, tightens the framework for using life insurance policy proceeds to pay for funeral or cemetery services, and expands consumer protections. It introduces a structured, capped assignment mechanism, rigorous disclosures, dispute-resolution procedures, and strict enforcement provisions, including penalties and a consumer-education fund. The bill notably restricts ownership/operation of funeral businesses by insurers, regulates limited life insurance producer licenses, and requires clear disclosures about associations and pricing. The act becomes law only if SB 1060 is enacted, indicating coordinated legislative action.

Compiled from official sources — confirm details with the bill’s official record.

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