Company: SUND
Filing Date: 2025-06-30
Form Type: 10-K
Source: 0001641172-25-017143
Chunk: 22

Company: Sundance Strategies, Inc.
Filing Date: 2025-06-30
Form: 10-K
Item: Item 1
Chunk 22
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 his
or her own life and may name any person as beneficiary. However, if a person purchases insurance on his or her own life for the benefit
of a party who does not have an insurable interest in the life of the insured for the purpose of evading the insurable interest laws,
the purchase may be viewed under applicable state law as a violation of the state’s insurable interest laws. Should the issuer
own an interest in a policy that was originally issued to an owner or for the benefit of a beneficiary (if required) that did not have
an insurable interest, it is possible that the issuer may not have a valid claim for the death benefits on such policy, and upon the
death of the insured, the issuing insurance company may refuse to pay the death benefits on the policy to us or may be required to pay
the death benefit to other beneficiaries of the insured. Should any such claims be successful in relation to the policies underlying
NIBs, we could lose some or all the amounts we have invested in NIBs, although in some states the issuing insurance company may be required
to repay the premiums if it rescinds the policy. Some states, such as New Jersey, allow the carrier to retain all the premiums in the
event the policy is rescinded, and some states, such as Delaware, require premiums to be returned in cases where the policy is successfully
challenged by the carrier. Even if such claims are unsuccessful, significant amounts may need to be expended in defending such claims,
thereby reducing the amounts we may receive from NIBs and other life settlement interests we may purchase.

Concern
also exists regarding the applicability of state insurable interest requirements applicable to the purchase of a policy by an insured
or a person with an insurable interest in the life of the insured in circumstances in which the owner of the policy obtains a loan secured
by the policy to finance the payment of premiums on the policy, often referred to as a premium finance transaction. A substantial number
of the life insurance policies underlying NIBs have been originated pursuant to premium finance transactions. While it is generally accepted
by state law that an individual has an insurable interest in his or her own life, it is possible that a court might construe a premium
finance transaction as an attempt to evade the requirement that an insurable interest exist at the time an insurance policy is issued.
If the borrower in such a transaction is found to be acting, in fact, on behalf of a premium finance company to