Life Settlement News

The Life Insurance Settlement Association announced its strong support today for the recently introduced bill in the District of Columbia City Council to regulate life settlements in that jurisdiction. This legislation, introduced at the request of the D.C. Department of Insurance, Securities, and Banking, comprehensively protects life insurance policyowners by imposing tough licensing requirements on settlement providers and brokers and thorough oversight of interactions with consumers, including an important new set of disclosures and affirmations designed to buttress insurable interest requirements and prevent STOLI (stranger originated life insurance).

The NASD and SEC have stressed over the last year or so the importance of maintaining open lines of communications with the industry and both have been using technology to make those conversations easier.

The National Association of Insurance Commissioners (NAIC) today adopted amendments to the Viatical Settlements Model Act during the Association’s Summer National Meeting in San Francisco.

Boca Raton insurance magnate Barry Kaye was wrongly implicated in a fraud investigation after a Pennsylvania company gave erroneous information to a state regulatory agency, company officials said this week.

Legacy Benefits Corporation (New York), a recognized leader and innovator in the life settlements industry, has been granted a life settlement provider license in the state of Colorado, which recently enacted legislation regulating the field.

The Florida Office of Insurance Regulation (Office) today issued a Notice and Order to Show Cause to Coventry First LLC alleging violations of the Florida Insurance Code and for “engaging in fraudulent or dishonest practices.” Coventry First LLC, founded in 1999, engages in the purchase of life insurance policies of elderly individuals in exchange for cash payments.

Ross and Collaborating Agents Acting in Concert with Him Could Be Held Liable for Millions of Dollars, According to MCC

The Honorable Ronald L. Bauer, Judge of the Orange County Superior Court, granted MCC’s request for a preliminary injunction against Mark Ross, his companies, and those acting in concert with them. The injunction comes five weeks after Judge Bauer entered a restraining order against the same group for various violations of contracts and tort law.

North Dakota last week became the first state to adopt a more stringent statute regulating life settlements, with special emphasis on stranger-originated life insurance. Other states may follow, making life settlements a less attractive option for adviser clients who want to sell or invest in life insurance policies, industry observers say. Life settlements are the sale of life insurance policies by policyholders to third-party investors.

Troy, New York, March 30, 2007 — Representative Michael Ripley (IN), Chair of the National Conference of Insurance Legislators (NCOIL) Life Insurance & Financial Planning Committee, has scheduled an interim meeting of an NCOIL Subcommittee on Life Settlements on Saturday, April 21, at the Hyatt Regency Crystal City at Reagan National Airport outside Washington, D.C. During the meeting, which is scheduled from 10:00 a.m. to 4:00 p.m. and will be open to the public, legislators will consider amending an NCOIL Life Settlements Model Act.

While analyzing what steps to take to restrict the sale of life insurance policies purchased only to be resold again, state legislators are closely evaluating the issue of life settlements.
Usually, in life settlement transactions, an elderly person sells a survivorship, whole, universal, variable, or term life insurance policy for a certain portion of the policy’s face value.