Life settlement trade group the Life Insurance Settlement Association (LISA) proposed amendments to the National Council of Insurance Legislators’ (NCOIL) life settlement model act at NCOIL’s Spring National Meeting on 12 April.
Coventry First co-founder and Executive Chairman Alan Buerger, a former LISA Chair, was LISA’s witness before Chair, Rep. Carl Anderson (S.C.), Vice Chair, Sen. Vickie Sawyer (N.C.), and the members of NCOIL’s Life Insurance & Planning Committee. Buerger presented LISA’s proposed amendments, which focused on two areas identified by LISA members as essential to serving consumers: electronic commerce and consumers’ access to their licensed producers’ expertise.
“Because of their complexity and the substantial regulatory requirements attached to each transaction, the life settlement process is relatively slow,” said Bryan Nicholson, Executive Director at LISA.
“That is exacerbated by delays at the carrier level in obtaining basic necessary information, such as policy illustrations and verifications of coverage.
“That is why we proposed that carriers be required to allow electronic authorisations and observe a maximum 21-day turnaround for these basic requests. We also believe that after change of ownership forms have been submitted, the insurer should be required to respond by electronic means within 21 days. These proposals, which directly impact the consumer experience, would simply codify what should be the norm in the year 2024,” Nicholson added.
Commenting on LISA’s proposed amendment that would make it unlawful for an insurer to prohibit a life insurance producer or broker from disclosing to a client the availability of a life settlement contract, Buerger said: “This recognises that, in the 17 years since the model was last amended, there is a basic awareness among producers of the market and of the type of clients (senior owners of universal life policies) who, if they are considering surrender, might be able to access a better result in a life settlement transaction.”
The committee voted to reauthorize the current model for three more months, until NCOIL’s Summer Meeting in July.