Doug Head: Letter to The Gainesville Sun in Response to Commissioner McCarty
Orlando, FL - Florida’s Insurance Commissioner, Kevin McCarty, writing in the Sun, revealed that some insurance regulators cannot differentiate between a legitimate life settlement – the lawful sale of an existing life insurance policy to a third party for value – from the fraudulent purchase of new insurance, sold by a life insurance company’s own agent, known as Stranger-Originated Life Insurance (STOLI).
It is disturbing to think that an insurance commissioner cannot distinguish between a fraudulent insurance sale and a lawful secondary market sale.
Life settlements are a policyowner’s sale of an unwanted, unneeded, or unaffordable life insurance policy that has been in force for at least two years. Typically the insured under the policy is age 60 or over. Life settlements pay these policyowners an average of 300-500 percent more than they would get by merely cash surrendering their policy back to the carrier. The sale of a life insurance policy is a property right, protected by the laws of Florida and the United States. Life settlements are regulated in Florida as well as in 36 other states. READ MORE
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10/22/2009
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LISA Responds to ABC Report on the Life Settlement Market
Orlando, FL - Yesterday, World News Tonight (ABC) considered Life Settlements. Producers of the program found a physician consumer, Dr. Eddy Powell, who had happily sold his life insurance policy for far more than the value which the life insurer would have offered him at the time. Dr. Powell sold the policy for a value which required the buyer to pay the premiums for the rest of Dr. Powell’s (presumably long) life. In the ABC piece, Dr. Powell expressed regret for having sold the policy because, though the sale afforded him the ability to pay off his debts, he was no longer the owner of the policy. According to some experts, Dr. Powell appeared to have forgotten that, before considering the life settlement option, he faced two unsavory choices: sell his policy to the insurer for pennies on the dollar or allow it to lapse for a complete loss. The Life Insurance Settlement Association (LISA) encourages people who can hang onto their policies to do so, but for those who would otherwise lapse or surrender their policies, the settlement option should be considered wherever possible. The public needs to know that they have choices and that a life settlement is one of them. READ MORE
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10/06/2009
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Life Insurance Settlement Association Delivers House Testimony on Industry’s Value to Consumers and Dismisses the Media’s Sensationalist Take on the Industry
Washington D.C. - Yesterday on Capitol Hill, Russel Dorsett, President of the Life Insurance Settlement Association (LISA) testified before Congress on the benefits of life settlements to American consumers. In testimony to the House Subcommittee on Capital Markets, Insurance and Government-Sponsored Enterprises, Mr. Dorsett reported that American consumers have benefited greatly from the life settlement market and have received nearly $10 billion over the past decade, “making it possible for them to afford retirement, medical care, or simply to enjoy the lifestyle they have earned,” said Dorsett, continuing: “The average settlement pays policy owners 4 to 6 times the policy’s cash value.” READ MORE
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09/25/2009
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Life Insurance Settlement Association Responds to New York Times Article
The Life Insurance Settlement Association (LISA) has sent a letter-to-the-editor of The New York Times in response to its September 5 story, "Wall Street Pursues Profit in Bundles of Life Insurance."
Dear Editor,
Under an initial headline of "New Exotic Investments" (9/5), the New York Times printed a large format piece on investment in life insurance policies. By the tone of the piece, one might have thought that Wall Street created the secondary market for life insurance; clearly not the case. Owners of life insurance have long enjoyed the ability of treating their life insurance policies like any other "ordinary property." In 1911, the landmark case Grigsby vs. Russell, secured a policy owner's right to sell or otherwise assign the rights to their policy as they deem fit. Indeed, as far back as 1855 New York's highest court held that policy owners enjoy the property rights in life insurance and, as such can "go to the best market he can find, either to sell it or borrow money on it." READ MORE
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09/14/2009
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