TYPE OF LICENSE LIFE SETTLEMENT
WHAT DOES THE STATE DEFINE AS CONTESTABLE?: 2 YEARS
WHAT IS THE REQUIRED HOLDING PERIOD?: 2 YEARS. See: HRS § 431C-33(m).
WHEN DOES LICENSE NEED TO BE RENEWED?:N/A
IS BROKER COMPENSATION DISCLOSURE REQUIRED?: YES. See: HRS § 431C-31(a)(8).
IS THERE A MINIMUM PAYMENT REQUIREMENT?: NO
WHEN DOES THE MONEY NEED TO BE IN ESCROW?: HRS § 431C-33(i). Within three business days after receipt from the owner of documents to effect the transfer of the policy, the provider shall pay the proceeds of the settlement to an escrow or trust account managed by a trustee or escrow agent in a state or federally chartered financial institution pending acknowledgment of the transfer by the issuer of the policy. The trustee or escrow agent shall be required to transfer the proceeds due to the owner within three business days of acknowledgment of the transfer from the insurer.
IS THERE A NOTICE REQUIREMENT TO THE INSURED AFTER THE SALE?: NO
IS THERE A NOTICE REQUIREMENT TO THE CARRIER BEFORE/AFTER THE SALE?: YES – HRS § 431C-33(g). Within twenty days after an owner executes the life settlement contract, the provider shall give written notice to the insurer that issued that policy that the policy has become subject to a life settlement contract. The notice shall be accompanied by the documents required by section -32(c). Also see: HRS § 431C-32(c).
WHAT IS THE RESCISSION PERIOD?: HRS § 431C-33(h). All life settlement contracts entered into in this State shall provide that the owner may rescind the contract on or before fifteen days after the date it is executed by all parties thereto. Rescission, if exercised by the owner, is effective only if both notice of the rescission is given, and the owner repays all proceeds and any premiums, loans, and loan interest paid on account of the provider within the rescission period. If the insured dies during the rescission period, the contract shall be deemed to have been rescinded subject to repayment by the owner or the owner’s estate of all proceeds and any premiums, loans, and loan interest to the provider.
IS THERE A VOC REQUIREMENT (OWN/STATE/NAIC FORM)?: YES – OWN – HRS § 431C-33(b). The insurer shall respond to a request for verification of coverage submitted by a provider, broker, or life insurance producer, not later than thirty calendar days of the date the request is received. The request for verification of coverage shall be made on a form approved by the commissioner. The insurer shall complete and issue the verification of coverage or indicate in which respects it is unable to respond. In its response, the insurer shall indicate whether, based on the medical evidence and documents provided, the insurer intends to pursue an investigation at this time regarding the validity of the insurance contract.
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