North Carolina General Statutes 58-58-255. Prohibited practices
(a) It is a violation of this Part for any person to enter into a contract within a two-year period commencing with the date of issuance of the policy unless the viator certifies to the provider that one or more of the following conditions have been met within the two-year period:
(1) The policy was issued upon the viator’s exercise of conversion rights arising out of a policy, provided the total time covered under the conversion policy plus the time covered under the prior policy is at least 24 months, or the contestability and suicide time periods have been waived by the insurer. The time covered under a group policy shall be calculated without regard to any change in insurance carriers, provided the coverage has been continuous and under the same group sponsorship.
Terms Used In North Carolina General Statutes 58-58-255
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Chronically ill: means :
- Contract: A legal written agreement that becomes binding when signed.
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- following: when used by way of reference to any section of a statute, shall be construed to mean the section next preceding or next following that in which such reference is made; unless when some other section is expressly designated in such reference. See North Carolina General Statutes 12-3
- Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
- Policy: means an individual or group life insurance policy, group life insurance certificate, group life insurance contract, or any other arrangement of life insurance affecting the rights of a resident of this State or bearing a reasonable relation to this State, regardless of whether delivered or issued for delivery in this State. See North Carolina General Statutes 58-58-205
- provider: means a person, other than a viator, that enters into or effectuates a viatical settlement contract on residents of this State or residents of another state from offices within this State. See North Carolina General Statutes 58-58-205
- Trustee: A person or institution holding and administering property in trust.
- Viator: means the owner of a policy or a certificate holder under a group policy who enters or seeks to enter into a viatical settlement contract. See North Carolina General Statutes 58-58-205
(2) The viator is a charitable organization exempt from taxation under 26 U.S.C. § 501(c)(3).
(3) The viator is not a natural person (e.g., the owner is a corporation, limited liability company, partnership, etc.).
(4) The viator submits independent evidence to the provider that one or more of the following conditions have been met within the two-year period:
a. The viator or insured is terminally or chronically ill.
b. The viator’s spouse dies.
c. The viator divorces his or her spouse.
d. The viator retires from full-time employment.
e. The viator becomes physically or mentally disabled and a physician determines that the disability prevents the viator from maintaining full-time employment.
f. The viator was the insured’s employer at the time the policy was issued and the employment relationship terminated.
g. A final order, judgment, or decree is entered by a court of competent jurisdiction, on the application of a creditor of the viator, adjudicating the viator bankrupt or insolvent, or approving a petition seeking reorganization of the viator or appointing a receiver, trustee, or liquidator to all or a substantial part of the viator’s assets.
h. The viator experiences a significant decrease in income that is unexpected and that impairs the viator’s reasonable ability to pay the policy premium.
i. The viator or insured disposes of his or her ownership interests in a closely held corporation.
(b) Copies of the independent evidence described in subdivision (a)(4) of this section and documents required by N.C. Gen. Stat. § 58-58-250(a) shall be submitted to the insurer when the provider submits a request to the insurer for verification of coverage. The copies shall be accompanied by a letter of attestation from the provider that the copies are true and correct copies of the documents received by the provider.
(c) If the provider submits to the insurer a copy of the owner or insured’s certification described in subdivision (a)(4) and subsection (b) of this section when the provider submits a request to the insurer to effect the transfer of the policy to the provider, the copy shall be deemed to conclusively establish that the contract satisfies the requirements of this section, and the insurer shall timely respond to the request. (2001-436, s. 3.)