ICAE – Washington, DC – Fall 1999 Exchange – Life & Health Breakout Session

Out-of-State Trusts & Associations

  • Not all DOIs regulate trusts or associations claiming out-of-state jurisdiction.
  • One state DOI reported having extraterritorial laws governing group health plans when a covered person resides within the state. They require stiff front-end compliance to ensure the organization is bonafide. So far, none has met the criteria.


  • Viatical companies purchase a “terminally ill” customer’s policy and make promises based on ROI. If the person outlives the agreement, premiums must continue to be paid, causing complaints.
  • Many insurers already make this service available directly to their policyholders with accelerated death benefit riders.
  • Web watch: Viatical companies are offering to buy current policies of healthy individuals as long as they have a life expectancy of more than 12 years.

Internet Marketing

  • A regulatory attendee said their state DOI recently added staff to monitor Internet marketing activity.
  • Some insurers monitor their own online marketing. One reported having an agent contracting system on the Internet with information on branch offices, agent contracts, recruitment, and securities registration.
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