Terms Used In Rhode Island General Laws 27-72-4

• Commissioner: means the director of the department of business regulation or his or her designee. See Rhode Island General Laws 27-72-2
• 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:

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

  (ii)  Who has an agreement in writing with one or more providers to finance the acquisition of life settlement contracts. See Rhode Island General Laws 27-72-2

• Fraud: Intentional deception resulting in injury to another.
• Life settlement contract: means 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 insurance policy or certificate, in return for the owner's assignment, transfer, sale, devise, or bequest of the death benefit or any portion of an insurance policy or certificate of insurance for compensation; provided, however, that the minimum value for a life settlement contract shall be greater than a cash surrender value or accelerated death benefit available at the time of an application for a life settlement contract. See Rhode Island General Laws 27-72-2
• 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 Rhode Island General Laws 27-72-2
• Policy: means an individual or group policy, group 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 Rhode Island General Laws 27-72-2
• Provider: means a person, other than an owner, who enters into or effectuates a life settlement contract with an owner. See Rhode Island General Laws 27-72-2
• Purchaser: means a person who pays compensation or anything of value as consideration for a beneficial interest in a trust which is vested with, or for the assignment, transfer, or sale of, an ownership or other interest in a life insurance policy or a certificate issued pursuant to a group life insurance policy that has been the subject of a life settlement contract. See Rhode Island General Laws 27-72-2
• 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. See Rhode Island General Laws 27-72-2
• Settled policy: means a life insurance policy or certificate that has been acquired by a provider pursuant to a life settlement contract. See Rhode Island General Laws 27-72-2
• 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:

  (i)  For a financing entity or provider; or

  (ii)  In connection with a transaction in which the securities in the special purpose entity are acquired by the owner or by a "qualified institutional buyer" as defined in Rule 144 promulgated under the Federal Securities Act of 1933, as amended; or

  (iii)  The securities pay a fixed rate of return commensurate with established asset-backed institutional capital markets. See Rhode Island General Laws 27-72-2

History of Section.
P.L. 2009, ch. 195, § 1; P.L. 2009, ch. 262, § 1; P.L. 2021, ch. 400, § 24, effective July 13, 2021; P.L. 2021, ch. 401, § 24, effective July 13, 2021; P.L. 2023, ch. 395, art. 1, § 24, effective December 31, 2023.