Terms Used In Hawaii Revised Statutes 431C-4

• Commissioner: means the insurance commissioner. See Hawaii Revised Statutes 431C-2
• Contract: A legal written agreement that becomes binding when signed.
• Conviction: A judgement of guilt against a criminal defendant.
• Financing entity: means an underwriter, placement agent, lender, purchaser of securities, purchaser of a policy or certificate from a provider, credit enhancer, or any entity that has a direct ownership in a policy or certificate that is the subject of a life settlement contract, but:

  (1) Whose principal activity related to the transaction is providing funds to effect the life settlement contract or purchase of one or more policies; and

  (2) Who has an agreement in writing with one or more providers to finance the acquisition of life settlement contracts. See Hawaii Revised Statutes 431C-2

• Fraud: Intentional deception resulting in injury to another.
• Life settlement contract: means :

  (a)

  (1) A written agreement entered into between a provider and an owner, establishing the terms under which compensation or any thing of value will be paid, which compensation or thing of value is less than the expected death benefit of the owner's policy or certificate, in return for the owner's assignment, transfer, sale, devise, or bequest of the death benefit or any portion of the policy or certificate for compensation, where the minimum value of the contract is greater than a cash surrender value or accelerated death benefit available under the policy or certificate at the time of an application for a life settlement contract;

  (2) The transfer for compensation or value of ownership or beneficial interest in a trust or other entity that owns such policy or certificate if the trust or other entity was formed or availed of for the principal purpose of acquiring one or more life insurance contracts, which life insurance contract insures the life of a person residing in this State; or

  (3)

  (A) A written agreement for a loan or other lending transaction, secured primarily by an individual or group policy; or

  (B) A premium finance loan made for a policy on or before the date of issuance of the policy where:

  (i) The loan proceeds are not used solely to pay premiums for the policy and any costs or expenses incurred by the lender or the borrower in connection with the financing;

  (ii) The owner receives on the date of the premium finance loan a guarantee of the future life settlement value of the policy; or

  (iii) The owner agrees on the date of the premium finance loan to sell the policy or any portion of its death benefit on any date following the issuance of the policy. See Hawaii Revised Statutes 431C-2

• Nolo contendere: No contest-has the same effect as a plea of guilty, as far as the criminal sentence is concerned, but may not be considered as an admission of guilt for any other purpose.
• Person: means any natural person or legal entity, including but not limited to a partnership, limited liability company, association, trust, or corporation. See Hawaii Revised Statutes 431C-2
• Policy: means an individual or group policy, certificate, contract, or arrangement of life insurance owned by a resident of this State, regardless of whether delivered or issued for delivery in this State. See Hawaii Revised Statutes 431C-2
• Provider: means a person, other than an owner, who enters into or effectuates a life settlement contract with an owner. See Hawaii Revised Statutes 431C-2
• Purchaser: means a person who pays compensation or anything of value as consideration for a beneficial interest in a trust that is vested with, or for the assignment, transfer, or sale of, an ownership or other interest in a policy or a certificate that has been the subject of a life settlement contract. See Hawaii Revised Statutes 431C-2
• Related provider trust: means a titling trust or other trust established by a licensed provider or a financing entity for the sole purpose of holding the ownership or beneficial interest in purchased policies in connection with a financing transaction, that includes a written agreement with the licensed provider under which the licensed provider is responsible for ensuring compliance with all statutory and regulatory requirements and under which the trust agrees to make all records and files relating to life settlement transactions available to the insurance division as if those records and files were maintained directly by the licensed provider. See Hawaii Revised Statutes 431C-2
• Settled policy: means a policy or certificate that has been acquired by a provider pursuant to a life settlement contract. See Hawaii Revised Statutes 431C-2
• Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
• Special purpose entity: means a corporation, partnership, trust, limited liability company, or other legal entity formed solely to provide either directly or indirectly access to institutional capital markets for a financing entity or provider in connection with a transaction in which the securities in the special purpose entity:

  (1) Are acquired by the owner or by a "qualified institutional buyer" as defined in Rule 144A of the Securities Act of 1933, as amended; or

  (2) Pay a fixed rate of return commensurate with established asset-backed institutional capital markets. See Hawaii Revised Statutes 431C-2