A May 7 story, “AALU Wants Changes In Revised Life Settlement Model Act” contained some errors, which need to be clarified as follows:
o AALU has consistently worked with the life insurance industry–ACLI, NAIFA, and NAILBA–rather than the settlement industry toward the twin goals of addressing stranger-originated life insurance effectively, while protecting legitimate life insurance and life settlement arrangements.
o AALU worked with the life insurance industry and the NAIC for, and gives support to, key features already in the draft model, such as exceptions for legitimate arrangements used for estate, business continuation, business protection and employee benefits planning, as well as a provision that allows a person with an insurable interest who puts up his, her, or its own money during the first 2 years to sell the policy thereafter.
o In addition to supporting features that are already part of the proposed model act, AALU supports the clarification and narrowing of a restriction on “evaluation for settlement” so that it applies to STOLI, but not to legitimate life insurance and life settlement arrangements.
The revised article can be found on the National Underwriter website at: Document Link