Recent Guidance on Life Insurance Payments in the Form of Viaticals

The Background A "viatical" is a contractual arrangement in which an investor buys a life insurance policy from an insured (or, perhaps, another) for a negotiated purchase price. The investor generally continues to pay the premiums on the policy and is paid the proceeds from the insurance...

Tracking Down and Collecting Unclaimed Life Insurance

The most basic purpose of having a life insurance policy is to provide some assistance for loved ones when you die. Wealthier people sometimes use life insurance for estate planning , while most people expect the policies on which they have paid premiums for decades to help their heirs get by - or at...

New Appleman on Insurance: Current Critical Issues Article Has Been Published in the Spring 2011 Issue of ABA publication, The Brief

The article is "Illicit Life Settlements" by Michael Lovendusky. The article addresses the systematic acquisition and transfer of life insurance policies to investors without insurable interest in the insureds' lives is a controversial activity. The systems encourage illicit schemes for...

Unpaid Insurance Benefits Issues Continue to Intensify

By Phil Stano, Partner, Sutherland Asbill & Brennan LLP Attention to unclaimed property issues affecting life insurance companies – including issues relating to unpaid life insurance and annuity benefits – has significantly escalated in recent weeks, due to regulatory actions, media...

What Does the Debt Deal Debacle Mean to your Life Insurance Coverage?

Many are feeling this week how the congressional quagmire has impacted their portfolios. One other impact that many may be unaware of is that the downgrade of US credit rating has changed the credit rating of major life insurance companies (see below). What action should you be taking to review your...

Troutman Sanders LLP: New York AG Expands Life Insurance Industry Probe

New York Attorney General Eric Schneiderman has issued subpoenas to at least nine leading life insurers to examine whether the firms have adequately ensured payouts on policies of deceased customers. The investigation is believed to encompass three areas of inquiry. The first is whether life insurance...

Wager On Life Is Void -- Insurance Requires Insurable Interest

By Barry Zalma, Attorney and Consultant It is the essence of insurance that for insurance to exist the person insured must have an insurable interest in the property or life insured. Life insurance insurable interest can be defined as an interest based upon a reasonable expectation of pecuniary...

IRS Adds Flexibility to Trusts

As estate planning practitioners are well aware, IRC Section 2042 includes in the gross estate: insurance proceeds on the life of the decedent receivable by the executor; and insurance proceeds on the life of fhe decedent received by others, where the decedent possessed any incident of ownership...

The Rise of Stranger-Originated Life Insurance Lawsuits

In this Analysis, Brian T. Casey and Rachel B. Coan focus on "stranger-originated life insurance" or "STOLI"-- in which a life insurance policy is originated primarily or solely for the purpose of resale. They chronicle how the clash of the insurable interest requirement and the evolving...

The Rise of Stranger-Originated Life Insurance Lawsuits And The Legal Issues

In this Analysis, Brian T. Casey and Rachel B. Coan focus on "stranger-originated life insurance" or "STOLI"- in which a life insurance policy is originated primarily or solely for the purpose of resale. They chronicle how the clash of the insurable interest requirement and the evolving...

2011 in Review: 10 Biggest Insurance Regulatory Headliners

By Fred E. Karlinsky, Richard J. Fidei, and Elizabeth M. Fohl, Attorneys, Colodny, Fass, Talenfeld, Karlinsky & Abate Fred E. Karlinsky, Richard J. Fidei, and Elizabeth M. Fohl of the law firm of of Colodny, Fass, Talenfeld, Karlinsky & Abate have written a round-up of the ten most important...

How to Coordinate Your Life Insurance with Your Estate Plan

Life insurance can be a powerful tool in your estate plan . It can be relied on to help your surviving spouse or heirs when you're gone. If your estate is taxable, life insurance may be used to pay estate taxes and other expenses. As with any aspect of estate planning, the devil is in the details...

Minor children? Here are the steps you need to take to protect them

The importance of life insurance for parents with young children cannot be overstated. However, insurance is just one part of the story. To ensure your child's financial security, you need to properly plan for how the proceeds will be distributed to your child, as well as for how your child's...

The Supreme Court's Decision in Hillman v. Maretta: The Perils of Beneficiary Designation

By Professor by Leo P. Martinez Hillman v. Maretta , decided by the U.S. Supreme Court on June 3, 2013 [ enhanced version available to lexis.com subscribers ], illustrates the intricacies of the constitutional preemption doctrine and the difficulty of accounting for human behavior. The case, decided...

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California Announces Death Master settlement with ING

Conduct exam of a second insurer finds MassMutual using Death Master Database properly Insurance Commissioner Dave Jones has announced that the California Department of Insurance has, with other state insurance regulators, reached a settlement agreement with ING over the insurer’s use of...

Insurance Commissioner Announces Death Master settlement with Aegon

Insurance Commissioner Dave Jones announced today that the California Department of Insurance has, with other state insurance regulators, reached a settlement agreement with Aegon over the insurer's use of the Social Security Administration's Death Master File database to ensure policyholders...

N.Y. Insurance Regulator Rejects Industry Standard for Establishing Reserve Requirements

By the Ballard Spahr LLP Insurance and Consumer Financial Services Groups The Superintendent of the New York State Department of Financial Services (DFS), Benjamin M. Lawsky, has informed his fellow state insurance regulators in the National Association of Insurance Commissioners (NAIC) that New...

Life Insurance on Bag of Money

Money Manager That Committed Suicide Suspected in $10 Million Ponzi Scheme

Indiana authorities are seeking to freeze the assets of a Kokomo investment advisor who recently committed suicide amid suspicions he ran an elaborate Ponzi scheme with potential losses of at least $10 million. According to the Indiana attorney general's office, Richard Schwartz, who committed suicide...

Settlement Reached in Death Master Case with New York Life Insurance Company

California Insurance Commissioner Dave Jones announced today that the California Department of Insurance has, with other state insurance regulators, reached a settlement agreement with New York Life Insurance Company over the insurer's use of the Social Security Administration's Death Master...

Pay a Million for Nothing: Sufficient Notice of Premium Due

Cash Surrender Value Life Insurance On Old Person Not a Bargain Conseco Life Insurance Company’s predecessor issued a flexible premium life insurance policy to Johnston & Johnston on the life of Mary Ann D. Johnston in 1988. The Policy’s cash surrender value dropped below zero dollars...

Another Multistate Settlement Reached in Death Master Case - Genworth Life Insurance Agrees to Business Practice Reforms

The California Department of Insurance has announced that along with other state insurance departments, they have reached a settlement with the Genworth Life Insurance Company over the insurer's use of the Social Security Administration's Death Master File database. The settlement ensures protection...

Life Insurance Remedies: May a Living Insured Recover Damages for an Insurer's Failure to Provide a Required Grace Period Notice?

In Life Insurance Remedies: May a Living Insured Recover Damages for an Insurer’s Failure to Provide a Required Grace Period Notice?, by Michael P. Cunningham of Funk & Bolton, P.A., the author notes that most attorneys practicing in the area of life insurance have likely encountered cases...

Report to NAIC on Captives: The Controversy About Principle-Based Reserves and Captives Continues

The use by life insurance companies of captive reinsurance companies to finance XXX and AXXX reserves has been a significant and contentious issue in recent years.[1] Some members of the National Association of Insurance Commissioners (the "NAIC") are deeply opposed to captive-based financing...