viatical settlement


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Related to viatical settlement: Viatical Settlement Company

viatical settlement

noun life insurance agreeeent, life insurance payment, life insurance settlement, reffrmation of a life insurance policy, revision of a life insurrnce agreement
References in periodicals archive ?
Second, however, this sudden jump in longevity sounded a death knoll for firms that had survived from the profits obtained from viatical settlement sales.
Investment vehicles for viatical settlement syndication consist of pooling a series of high-premium term and/or ordinary life policies issued on the lives of persons who have been diagnosed with HIV/AIDS or other life threatening illnesses.
Currently, 39 states and Puerto Rico regulate life settlements, and the National Association of Insurance Commissioners (NAIC) recognizes them as a viable solution (NAIC, "NAIC Adopts Viatical Settlements Model Act Revisions," News Release (June 4, 2007), www.
Because of the need to protect insureds and to create a transparent and fair viatical settlements market, the National Association of Insurance Commissioners developed the Viatical Settlements Model Act in 1993 as well as accompanying rules to guide states in their regulation of the viatical settlements industry.
A good analogy in attempting to understand the parties to a viatical settlement transaction is a real estate closing.
One way to defraud the investor is to sell a viatical knowing that the insured lied about his or her health condition when applying for the policy, as did one Florida viatical settlement company.
Nearly every type of life insurance policy qualifies for a viatical settlement, providing it's been in force for at least two years.
The first viatical settlement companies emerged in the late 1980s, and primarily acted as brokers, matching up terminally-ill policyholders with investors.
The Internal Revenue Service has taken a more enlightened position in relation to the second possible event where an insured assigns his life insurance contract to the insurance company (as contrasted with the above PLR in which the sale was to a Viatical settlement company) that issued the policy and the accelerated death benefit is paid pursuant to a contract term.
And in any case, while it may once have been true that a single test showing a lowered T-cell count could result in a large viatical settlement, that's not the case today.
In the past, viatical settlement payments were subject to Federal income taxes.
A focal point of the industry's efforts is the National Association of Insurance Commissioners (NAIC), where regulators are considering amendments to the NAIC Viatical Settlement Model Law to close loopholes that allow STOLI transactions.