Code of Vermont Rules › Agency 21 - DEPARTMENT OF FINANCIAL REGULATION › Sub-Agency 020 - INSURANCE DIVISION › Chapter 047 - VIATICAL SETTLEMENTS - REGULATION 95-4 › Section 21 020 047 - VIATICAL SETTLEMENTS - REGULATION 95-4

Current through June, 2024
Section 1 Purpose
The purpose of this regulation is to regulate the affairs of
				  persons and institutions engaged in viatical settlements in Vermont, to
				  encourage competition among them, and to protect the public against unfair and
				  unconscionable practices in the course of that business. This regulation sets
				  forth requirements pertaining to: licensing of viatical settlement providers
				  and viatical settlement brokers; viatical settlement contracts and payouts;
				  reporting; examination; marketing; advertising; disclosure; and, rules
				  applicable to life insurers which will facilitate viatical settlement
				  transactions.
Section 2
				Authority
This regulation is issued pursuant to the authority vested in
				  the Commissioner of Banking, Insurance and Securities ("Commissioner") by Title
				  8 V.S.A., Sections 75 and 3833 and Chapter 129.
Section 3 Definitions
As used in this regulation:
A. "Viatical Settlement broker: means any
				person or his or her agent who, for a fee, commission or other valuable
				consideration, offers or advertises the availability of viatical settlements,
				introduces viators to viatical settlement providers, or solicits for, or offers
				or attempts to negotiate viatical settlements between a viator and one or more
				viatical settlement providers. "Viatical settlement broker" does not include an
				attorney, accountant or financial planner retained to represent the viator
				whose compensation is not paid by the viatical settlement provider.
B. "Viatical settlement contract" means an
				agreement between a viatical settlement provider and a person who owns,
				controls or has rights to the benefits or values of a life insurance policy, or
				who owns, is covered by, controls or has rights to the benefits or values of a
				group policy, either of which insures the life of a person who has a
				catastrophic or life threatening illness or condition and under which the
				viatical settlement provider will pay compensation or anything of value, which
				compensation or value is less than the expected death benefit of the insurance
				policy or certificate, in return for the viator's assignment, transfer, sale,
				devise or bequest of the death benefit or ownership of the insurance policy or
				certificate to the viatical settlement provider.
C. "Viatical settlement provider" means any
				person or entity which enters into an agreement with a person who owns, is
				covered by, controls or has rights to the benefits or values of a life
				insurance policy or who owns, controls or has rights to the benefits or values
				of a group policy either of which insures the life of a person who has a
				catastrophic or life threatening illness or condition, under the terms of which
				the viatical settlement provider pays compensation or anything of value, which
				compensation or value is less than the expected death benefit of the insurance
				policy or certificate, in return for the assignment, transfer, sale, devise or
				bequest of the death benefit or ownership of the insurance policy or
				certificate to the viatical settlement provider. Viatical settlement provider
				does not include:
1) Any bank, savings bank,
				savings and loan association, credit union or other licensed lending
				institution which takes an assignment of the subject life insurance policy as
				collateral for a loan;
2) The
				issuer of the subject life insurance policy providing accelerated
				benefits;
3) Any natural person who
				enters into no more than one agreement in a calendar year for the transfer of a
				life insurance policy for any value less than the expected death benefit,
				or,
4) Any corporation, partnership
				or partner that purchases a life insurance contract of an employee or retiree
				of the corporation of a partner. The settlement made on any contract exempt
				under section
				4
				) of this regulation shall be reasonable and subject to the standards imposed
				on viatical settlement providers in 8 V.S.A. sections 3831, 3832, and 3833 and
				sections 9, 10, and 11 of this regulation.
D. "Viator" means any person who owns,
				controls or has rights to the benefits or values of a life insurance policy or
				who owns, is covered by, controls or has rights to the benefits or values of a
				group policy, either of which insures the life of a person who has a
				catastrophic or life threatening illness or condition; and, who enters into an
				agreement under which the viatical settlement provider will pay compensation or
				anything of value, which compensation or value is less than the expected death
				benefit of the insurance policy or certificate, in return for the assignment,
				transfer, sale, devise or bequest of the death benefit or ownership of the
				insurance policy or certificate to the viatical settlement provider.