Coventry Reaffirms Strong Support for New York Life Settlement Bill
Coventry First strongly supports the life settlement legislation sponsored by Senator John A. DeFrancisco and Senator James L. Seward that will provide much-needed protection for New York seniors who choose to sell their life insurance policies in the secondary market. Senate Bill 5476, based on the model settlement act of the National Association of Insurance Commissioners (NAIC), protects seniors through comprehensive regulation over life settlements, including numerous disclosures, licensing requirements and strong anti-fraud measures. Twenty-six states have already adopted such NAIC-based laws. The American Council of Life Insurers (ACLI) and others have recently suggested that the New York life settlement legislation would not protect New York consumers but would facilitate speculative uses of life insurance. This suggestion is incorrect. At the June 2005 NAIC Life Insurance Committee meeting, Alan Buerger, CEO of Coventry First, was the first to identify the need to have stronger settlement laws and the only witness to suggest that stronger settlement laws could effectively combat investor-initiated life insurance (IILI). It is, in fact, the absence of settlement law that presents the greatest risk of abuses involving life insurance. Senate Bill 5476 materially strengthens the protections contained in the NAIC model by making it illegal for trusts, corporations or charities to sell policies during the 2-year contestability period; it prohibits policies from being moved out of the state to avoid the strict regulation of the New York settlement law. In fact, the bill goes significantly beyond the law of any other state by eliminating nine exceptions to the prohibitions found in the NAIC model. Most importantly, the bill gives the New York Insurance Superintendent broad investigative and enforcement authority over those engaged in these activities. It is because of the addition of these stronger provisions that the bill was supported by Coventry First and the Life Insurance Council of New York (LICONY), a trade association of life insurance carriers. When this legislation becomes law, seniors in New York will be protected by the strongest and most comprehensive life settlement law in the country. About Coventry Coventry (http://www.coventryfirst.com) bridges insurance and capital markets to create groundbreaking products for the financial services industry. The company is the leader in the secondary market for life insurance and pioneered the resulting life settlement industry. Fueled by bold ideas, a deep understanding of life insurance, and impeccable standards, Coventry continues to lead the market by opening new opportunities for consumers and the financial professionals who serve them. Based in Fort Washington, PA, Coventry is the first secondary market company to ever receive Standard & Poor’s highest Servicer ranking and was named the nation’s 10th fastest-growing privately held company in the annual INC. 500 listing.
CONTACT:
Coventry
Kirstin Crouthamel
877-836-8300
