A life settlement provider operating in New York state need not necessarily tell a life policy owner about every contractual arrangement that the provider has with unaffiliated life settlement brokers, state officials say.
The provider can avoid having to disclose every contractual arrangement if the agreements use the same boiler-plate language governing how the provider and the broker will handle life settlement applications, according to the general counsel’s office at the New York State Insurance Department.
Office officials present that conclusion in Office of the General Counsel Opinion Number 11-02-07.
New York department officials say in the opinion that they are answering a question from a life settlement provider compliance director. The compliance director said the provider uses boiler-plate language stating that it is willing to consider buying policies from sellers who are represented by a broker, will not necessarily buy the policies, and will not conduct business with brokers who do not agree to the arrangements described in the boiler-plate language.
The compliance director has asked the New York department to confirm that New York Insurance Law Section 7811(a)(13) does not require the disclosure of the agreements.
In August 2010, the department held that a life settlement provider must disclose any affiliations or contractual arrangements with any other life settlement provider,