The Life Insurance Finance Association says lawmakers should be careful when updating the laws that govern who can pay to insure an individual’s life.

Lawmakers may need to fine-tune the concept of “insurable interest,” but they should use a fine brush and avoid making changes that might interfere with legitimate premium financing and life settlement transactions, according to Scott Cipinko, of managing director LIFA, Atlanta, a new trade group for the premium finance industry.

“LIFA and its members strongly believe that life insurance policies should only be purchased based upon an insurable interest in the life of the insured,” LIFA says in a statement.

But LIFA distinguishes between premium financing transactions used to buy insurance in which there is an insurable interest and other types of transactions currently under regulatory scrutiny, such as investor-initiated, investor-owned, stranger-owned and charity-owned life insurance.