Beyond the Headlines: Life Settlements Industry is Ethical and Regulated

by Darwin Bayston, CFA - President and CEO - Life Insurance Settlement Association | July 27, 2015 Leave a Comment

Beyond the Headlines: Life Settlements Industry is Ethical and RegulatedLast month, we wrote about the importance of setting the record straight when a misinformed person takes to the Internet to publish false information regarding life settlements. Based on some reader feedback, this month we thought it might be useful to go beyond the headlines and tackle a few important questions that some consumers ask about the life settlements marketplace.

 

Here are three key characteristics about the way that business is conducted in the U.S. life settlements industry:

  

  • Ethical

     
    As the official professional association of the U.S. life settlements industry, LISA requires that all members of the association agree to abide by our Code of Ethics and Standards of Professional Conduct. These ethical standards are fundamental to the values of LISA and our members understand they are critical to maintaining the public’s trust in the life settlement markets and in the life settlement industry. All LISA members must abide by these detailed ethical standards and violations may result in disciplinary sanctions by LISA, including suspension or revocation of membership. To review LISA’s Code of Ethics, go to http://www.lisa.org/about/code-of-ethics. 

  • Regulated

     
    As of 2015, 42 states and the territory of Puerto Rico regulate life settlements, affording most American seniors with protection under comprehensive life settlement laws and regulations. These regulations protect the integrity of this basic consumer option: life settlements offer a potentially valuable alternative to lapsing an unneeded or unwanted life policy back to the life insurance company. To review the regulations governing the life settlement marketplace, go to http://www.lisa.org/industry-resources/life-settlement-regulation. 

  • Proven 

    The proof is always in the empirical results. According to the National Association of Insurance Commissioners’ (NAIC) Consumer Information System, since the start of 2012, only two consumer complaints involving life settlements have been reported closed by state commissioners. This is in stark contrast to the more than 8,000 complaints against life insurance carriers in 2014 alone for delays in paying claims. The ethical and regulatory safeguards in place have served to protect the integrity of the U.S. life settlements marketplace.

 

It’s important for consumers to go beyond the headlines and ask tough questions about any asset class, financial product or retirement planning option in order to separate fact from fiction. By that measure, the evidence is clear: the life settlements industry is a safe marketplace for American consumers who are considering an alternative to the lapse or surrender of their life insurance policies.

 

To find a LISA Member authorized to help you click here.

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