Virginia Administrative Code › Title 14 - INSURANCE › Agency 5 - STATE CORPORATION COMMISSION, BUREAU OF INSURANCE › Chapter 71 - RULES GOVERNING VIATICAL SETTLEMENT PROVIDERS AND VIATICAL SETTLEMENT BROKERS › Section 14VAC5-71-90 - General rules

Current through Register Vol. 40, No. 24, July 15, 2024
A.
				With respect to policies containing a provision for double or additional
				indemnity for accidental death, the additional payment shall remain payable to
				the beneficiary last named by the viator prior to entering into the viatical
				settlement contract, or to such other beneficiary, other than the viatical
				settlement provider, as the viator may thereafter designate, or, in the absence
				of a designation, to the estate of the viator.
B. Payment of the proceeds of a viatical
				settlement pursuant to § 38.2-6008D of the Code of Virginia shall be by
				means of wire transfer to the account designated by the viator or by certified
				check or cashier's check made payable to the viator or his designee.
C. Payment of the proceeds pursuant to a
				viatical settlement shall be made in a lump sum except where, in response to
				the request of the viator, the viatical settlement provider has purchased an
				annuity issued by an insurance company licensed in this Commonwealth for the
				purpose of payment of the proceeds, and the insurance company agrees to make
				all payments directly to the viator or the viator's beneficiary. No portion of
				the proceeds shall be retained by the viatical settlement provider, escrow
				agent, or other person without the written consent of the viator.
D. Contacts for the purpose of determining
				the health status of the insured after the viatical settlement has occurred
				shall be limited, in the aggregate, to once every three months for a person
				with a life expectancy of more than one year and to no more than one per month
				for a person with a life expectancy of one year or less. Such contacts shall be
				made only by a licensee under this chapter or its authorized representative. As
				used in this section, "authorized representative" means an individual who, for
				or on behalf of a licensee under this chapter, contacts an insured under a
				viatical policy after the viatical settlement has occurred. The viatical
				settlement provider or viatical settlement broker shall explain the procedure
				for these contacts at the time the viatical settlement contract is entered
				into. If contact will be or is made by both the viatical settlement broker and
				the viatical settlement provider, both the viatical settlement broker and the
				viatical settlement provider shall have and maintain a system that tracks
				aggregate contacts.
E. If a
				viatical settlement provider enters into a viatical settlement that allows the
				viator to retain an interest in the policy, the viatical settlement contract
				shall contain the following provisions:
1. A
				provision that the viatical settlement provider will effect the transfer of the
				amount of the death benefit only to the extent or portion of the amount
				viaticated. Benefits in excess of the amount viaticated shall be paid directly
				to the viator's beneficiary by the insurance company;
2. A provision that the viatical settlement
				provider will, upon acknowledgment of the perfection of the transfer, either:
a. Advise the insured, in writing, that the
				insurance company has confirmed the viator's interest in the policy,
				or
b. Send the insured a copy of
				the instrument sent from the insurance company to the viatical settlement
				provider that acknowledges the viator's interest in the policy; and
3. A provision that apportions the
				premiums to be paid by the viatical settlement provider and the viator,
				provided that the contract provides premium payment terms and nonforfeiture
				options no less favorable, on a proportional basis, than those included in the
				policy.