Law Prohibiting Discretionary Clauses Requires De Novo Review, Federal Judge Says

CHICAGO - An Illinois statute prohibiting discretionary clauses in insurance policies applies to a disability policy governed by the Employee Retirement Income Security Act, where the policy was renewed and the insurer terminated the participant's disability benefits after the statute was adopted, a federal judge in Illinois ruled May 1 (Zaccone v. Standard Life Insurance Company, No. 10 CV 00033, N.D. Ill.).

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