Oregon Administrative Rules › Chapter 836 - DEPARTMENT OF CONSUMER AND BUSINESS SERVICES, INSURANCE REGULATION › Division 14 - ALTERNATIVE INSURANCE ORGANIZATIONS › Section 836-014-0260 - Rights and Duties of Parties to Life Settlement Contract

Current through Register Vol. 63, No. 7, July 1, 2024
(1) A policyholder
			 or certificate holder who has entered a life settlement contract has the right
			 to retain additional benefits or optional riders that were part of the life
			 insurance policy, including but not limited to disability income, accidental
			 death and dismemberment and spouse, children and family riders, but not
			 including term riders. Any premiums payable on the insurance policy or
			 certificate that is the subject of the life settlement contract, including
			 premiums payable for additional benefits retained at the option of the
			 policyholder or certificate holder, shall be paid by the life settlement
			 provider when due, for the remaining duration of the life that is the subject
			 of the life settlement contract.
(2) Except as provided in this section (2),
			 any additional benefit or optional rider that the policyholder or certificate
			 holder elects not to continue must be terminated when the life settlement takes
			 place. A waiver of premium provision may be continued by the life settlement
			 provider.
(3) The life settlement
			 provider does not have the right to any cash surrender value unless all
			 additional benefits retained by the policyholder or certificate holder, whether
			 by rider or endorsement, are in a paid-up status and will be unaffected by any
			 change in cash surrender value.
(4)
			 The life settlement provider shall make the payment of proceeds of a life
			 settlement to an escrow agent as required in Section 13, chapter 711, Oregon
			 Laws 2009 (Enrolled Senate Bill 973) by means of wire transfer or by cashier's
			 check.
(5) Any policyholder or
			 certificate holder who enters into a life settlement contract has the right to
			 rescind the contract not later than the 60th day after the date on which the
			 contract is executed by all parties or not later than the 30th day after the
			 date the policyholder or certificate holder receives the life settlement
			 proceeds, whichever is the lesser period. Not later than the date on which the
			 life settlement proceeds are paid to the policyholder or certificate holder,
			 the life settlement provider must give the policyholder or certificate holder a
			 written statement of the date on which the rescission period expires. The
			 statement must include a notice to the policyholder or certificate holder that
			 a rescission is not complete until the full payment, including any premiums
			 paid by the life settlement provider, is returned to the life settlement
			 provider and that the full payment must be returned not later than the 30th day
			 after the date specified for expiration of the rescission period.
(6) If the statement required in section (5)
			 of this rule is given by mail, it shall be considered to be given when
			 deposited in the United States mail, first class postage prepaid.
(7) If notice of rescission is given by mail,
			 it shall be considered to be given when deposited in the United States mail,
			 first class postage prepaid.
(8) A
			 life settlement broker represents exclusively the owner, and not the insurer or
			 the life settlement provider, and owes a fiduciary duty to the owner, including
			 a duty to act according to the owner's instructions and in the best interest of
			 the owner.
(9) The life settlement
			 investment agent does not have the right to have any contact with the owner or
			 insured under a policy or to any knowledge of the identity of the owner or
			 insured.
Stat. Auth.: ORS
				  744.358
Stats. Implemented: ORS
				  744.341, Sec. 11, Ch. 711, OL
				  2009