As Boomers feel increasingly uncertain about being able to meet their retirement goals by the time they turn 65, they are turning to unconventional financial vehicles to meet their needs, including life settlements.
While the STOLI market has largely subsided in recent years, it is still a good idea to reflect upon the changes that came about in underwriting as a result.
Many tales have been told about this misunderstood industry. The one I Iike best is, “the life settlement industry is dead.” If this were a text message, I would reply in all caps: LOL.
JIm Avery is Prudential’s president of individual life insurance, and an outspoken critic of both the life settlements industry and stranger-owned life insurance (STOLI). He recently traveled to South Korea in an effort to convince the life insurance industry there to not allow the practice of life settlements.
The Court of Appeals recently held that New York Insurance Law § 3205(a) permits individuals to obtain insurance on their life for the purpose of immediately assigning the insurance to a third party who has no “insurable interest” in his/her life.
Policyholders have settled enough life insurance policies to have a noticeable effect on some insurers and reinsurers, according to Conning Research & Consulting analysts.
New York’s highest court on Wednesday said it was legal for residents of the state to take out life insurance on themselves and immediately sell the policy, a ruling seen as having substantial implications in the so-called “life settlement” market.
