Deconstructing the Life Settlement Application - Understanding the life settlement process (part 2)

Last time we left off we discussed the importance of knowing the identity of the insured .
The next pertinant question on the life settlement application is determining who the policy owner is.
The policy owner is the person or entity (ie trust, pension plan, business) that possesses all of the rights to the policy, including the right to sell the policy. 
For the sake of this discussion we are not concerned about the obligation of the policy owner to the beneficiarys and insured, such as the trustees obligation to the trust, but rather why having information about the policy owner is important.
The policy owners situs usually determine which states laws govern the transaction.  Thats why on the application the policy owners address is a critical piece of information.
Almost half of the policies that we review are trust owned life insurance .  In those cases the situs of the trust determines which state laws would apply.
When policies are company owned it is the location of the business that will determine the situs.
Often times when we are working in regulated states we are asked if the situs of the policy owner can moved from one staet to another.
To redomicile a policy to a unregulated state is not only unscrupulous but in certain states it is illegal and carries severe penalitiesl; including criminal prosecution

Please post any questions you have so we can better inform you.

Until next time keep educating yourself because in the words of Sy Sims an educated consumer is our best customer