Podcast Center
Video Center
Webcasts
Resource Center
Events
August 20, 2010 at 08:00 PM
A New York insurance lawyer contends that insurers are being “demonized” for issuing retained asset accounts.
The problem of how deceased persons’ assets are to be handled is common to the banking-thrift and broker-dealer industries as well as life insurance, says Marc Tract, a partner at Katten Muchin Rosenman, in an interview with the National Underwriter.
Tract’s comments were aimed at a draft law, known as the “Beneficiaries’ Bill of Rights,” proposed this week by the National Conference of Insurance Legislators. That proposal would impose strict standards and continuing oversight of RAAs by states.
The problem with the criticism and probes by various officials and congressional committees is that restrictions on RAAs alone would create an uneven playing field, Tract says.
To maintain a level playing field with other providers of services to beneficiaries and to give uniform protections to consumers, “I would advocate that perhaps a better solution than the one proposed by the Bill of Rights would be to look at what would be the minimum standards for banks, brokerage firms and insurers with respect to the disposition of assets post-death.”
He also proposes development of a regulatory regime that would protect consumers, “while not creating the impression that one form of asset was inherently more risky or prone to overreaching than another.”
Tract says he has no clients on the RAA issue.
