Regulators Urge More Oversight For Life Settlements

Law360, New York (September 24, 2009, 6:11 PM EDT) -- State and federal regulators warned lawmakers Thursday that life settlements — financial products that allow people to cash in on their life insurance policies by selling them to a third party — need more scrutiny.

The so-called stranger-owned life insurance, or STOLI, transactions run afoul of state laws because "there is no true insurable interest present at the time of policy issuance," Iowa Insurance Commissioner Susan E. Voss told the U.S. House of Representatives Financial Services Subcommittee on Capital Markets, Insurance and Government Sponsored Enterprises....
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