Illinois Compiled Statutes 215 ILCS 159/50 – Prohibited practices
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(a) It is a violation of this Act for any person to enter into a viatical settlement contract prior to the application of or issuance of a policy that is the subject of the viatical settlement contract. It is a violation of this Act for any person to enter into stranger-originated life insurance or STOLI as defined by this Act.
(b) It is a violation of this Act for any person to enter into a viatical settlement contract within a 2-year period commencing with the date of issuance of the insurance policy unless the viator certifies to the viatical settlement provider that one or more of the following conditions have been met within the 2-year period:
(1) The policy was issued upon the viator’s exercise
(b) It is a violation of this Act for any person to enter into a viatical settlement contract within a 2-year period commencing with the date of issuance of the insurance policy unless the viator certifies to the viatical settlement provider that one or more of the following conditions have been met within the 2-year period:
Terms Used In Illinois Compiled Statutes 215 ILCS 159/50
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Beneficiary: A person who is entitled to receive the benefits or proceeds of a will, trust, insurance policy, retirement plan, annuity, or other contract. Source: OCC
- Contract: A legal written agreement that becomes binding when signed.
- decree: is synonymous with the word "judgment". See Illinois Compiled Statutes 5 ILCS 70/1.24
- 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.
- individual: shall include every infant member of the species homo sapiens who is born alive at any stage of development. See Illinois Compiled Statutes 5 ILCS 70/1.36
- 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.
- 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.
- State: when applied to different parts of the United States, may be construed to include the District of Columbia and the several territories, and the words "United States" may be construed to include the said district and territories. See Illinois Compiled Statutes 5 ILCS 70/1.14
- Trustee: A person or institution holding and administering property in trust.
(1) The policy was issued upon the viator’s exercise
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of conversion rights arising out of a group or individual policy, provided the total of the time covered under the conversion policy plus the time covered under the prior policy is at least 24 months. 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.
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(2) The viator certifies and submits independent
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evidence to the viatical settlement provider that one or more of the following conditions have been met within the 2-year period:
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(A) the viator or insured is terminally or
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chronically ill;
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(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 a person with a physical
(C) the viator divorces his or her spouse;
(D) the viator retires from full-time employment;
(E) the viator becomes a person with a physical
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or mental disability and a physician determines that the disability prevents the viator from maintaining full-time employment;
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(F) a court of competent jurisdiction enters a
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final order, judgment, or decree 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;
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(G) the sole beneficiary of the policy is a
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family member of the viator and the beneficiary dies; or
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(H) any other condition that the Director may
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determine by regulation to be an extraordinary circumstance for the viator or the insured.
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(c) Copies of the independent evidence described in paragraph (2) of subsection (b) of this Section and documents required by Section 45 shall be submitted to the insurer when the viatical settlement provider or any other party entering into a viatical settlement contract with a viator submits a request to the insurer for verification of coverage. The copies shall be accompanied by a letter of attestation from the viatical settlement provider that the copies are true and correct copies of the documents received by the viatical settlement provider.
(d) If the viatical settlement provider submits to the insurer a copy of the owner or insured’s certification described in and the independent evidence required by paragraph (2) of subsection (b) of this Section when the viatical settlement provider submits a request to the insurer to effect the transfer of the policy to the viatical settlement provider, then the copy shall be deemed to conclusively establish that the viatical settlement contract satisfies the requirements of this Section, and the insurer shall timely respond to the request.
(e) No insurer may, as a condition of responding to a request for verification of coverage or effecting the transfer of a policy pursuant to a viatical settlement contract, require that the viator, insured, viatical settlement provider, or viatical settlement broker sign any forms, disclosures, consent, or waiver form that has not been expressly approved by the Director for use in connection with viatical settlement contracts in this State.
(f) Upon receipt of a properly completed request for change of ownership or beneficiary of a policy, the insurer shall respond in writing within 30 calendar days to confirm that the change has been effected or specifying the reasons why the requested change cannot be processed. No insurer shall unreasonably delay effecting change of ownership or beneficiary or seek to interfere with any viatical settlement contract lawfully entered into in this State.
(d) If the viatical settlement provider submits to the insurer a copy of the owner or insured’s certification described in and the independent evidence required by paragraph (2) of subsection (b) of this Section when the viatical settlement provider submits a request to the insurer to effect the transfer of the policy to the viatical settlement provider, then the copy shall be deemed to conclusively establish that the viatical settlement contract satisfies the requirements of this Section, and the insurer shall timely respond to the request.
(e) No insurer may, as a condition of responding to a request for verification of coverage or effecting the transfer of a policy pursuant to a viatical settlement contract, require that the viator, insured, viatical settlement provider, or viatical settlement broker sign any forms, disclosures, consent, or waiver form that has not been expressly approved by the Director for use in connection with viatical settlement contracts in this State.
(f) Upon receipt of a properly completed request for change of ownership or beneficiary of a policy, the insurer shall respond in writing within 30 calendar days to confirm that the change has been effected or specifying the reasons why the requested change cannot be processed. No insurer shall unreasonably delay effecting change of ownership or beneficiary or seek to interfere with any viatical settlement contract lawfully entered into in this State.