Last week, the Iowa Senate unanimously voted (49-0) to pass Senate File 2392 as amended by the Iowa House which, if signed by the Governor, would revise Iowa’s viatical settlements act to address stranger originated life insurance (“STOLI”) transactions. The bill, based on the NAIC’s Viatical Settlement Model Act that we previously reported about here, includes the 5-year prohibition on settlements. Additionally, the bill adopts NCOIL’s definition of STOLI and defines STOLI transactions as fraudulent acts. The Governor is expected to sign the legislation.
Other states that have recently adopted STOLI legislation include Maine and Indiana.
We will continue to monitor this topic and provide further updates at InsureReinsure.com.
