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Regs Implement Viatical Act

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Oklahoma insurance regulators have issued anti-fraud rules for life settlement providers.

The regulations implement provisions of the Oklahoma Viatical Settlement Act of 2008.

Under the rules, providers of life settlements and viatical settlements must give the insurance commissioner descriptions of internal procedures for detecting and investigating fraud, for resolving substantial inconsistencies between medical records and insurance applications, and for reporting suspected fraudulent settlement acts to the commissioner .

The rules also stipulate that providers must supply descriptions of anti-fraud education and training programs and descriptions of their internal anti-fraud staffers’ lines of responsibility.

Oklahoma’s Viatical Settlements Act was aimed at stopping stranger-originated life insurance transactions.

Oklahoma has based its act on a model developed by the National Conference of Insurance Legislators, Troy, N.Y.

The act prohibits policyholders from selling policies within 2 years after the policies are issued.