Life Settlement is a new and emerging phenomenon in the market. This is a recent development in the policy market. It is only in the 90’s that these term has come to be used and applied. This was possible as the viatical settlement providers increased their market share from AIDS patient to individuals with some other terminal disease and ultimately to the older generation of individuals who no longer need their life insurance policies. The Life settlement industry today has an increasing and fast growing market. It is on the way of becoming a multi billion dollar industry. Since the emergence of this industry there have been little of systematic problems directly associated to the concerns by the commentators as well as the insurance business insiders as to marketing public policy and abuses issues. The NAIC Viatical Settlement Working Group has revised the NAIC Viatical Settlement Model Act which was also sometimes termed as the ‘Model Act’. This act was revised in 2001. According to this act the Viatical Settlement plan should include life term settlement market among the other important things. It should also provide for advertising guidelines, increased protection for investor, increased disclosure and protection against fraud and also larger powers of examination. The status of this regulation is that it has currently been adopted by 27 states and another 16 states are considering enacting their own law regarding this life settlement. In the Model Act another thing included was the clarification of the status of the institutional investors. The life settlement regulation act also prevents insurance from being abused by the investors to make quick money.

The American Council of Life Insurers or ACLI has now proposed a few amendments in the Model Act so that they could prevent the third party investors from profiting from life insurance and owning which were originally issued in favor of individuals. The ACLI has also proposed that the settlements for the chronically or terminally ill individuals should be made permissible.

This entry was posted on Friday, February 2nd, 2007 at 4:43 am and is filed under premium financing, viatical settlement. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.