This article is a great update and information article about the current status of the life settlement industry.
Life Settlement Industry Vows Renewed Effort to Promote Effective Legislative Policy Making and Consumer Education
ORLANDO, FL, Nov 13, 2008 (MARKET WIRE via COMTEX) — Democratic political strategist Mark Penn addresses how the industry can improve public image at the Life Insurance Settlement Association’s 14th Annual Conference.
Life settlement industry leaders have pledged to expand their current legislative advocacy and consumer education initiatives in order to counter lingering public misconceptions caused, in part, by recent media reports.
Hundreds of financial professionals gathered at the Life Insurance Settlement Association’s (LISA) annual fall conference, held November 6-7 in Washington, D.C., to address concerns such as stranger-originated life insurance (STOLI) and its perceived link to legitimate consumer-friendly life settlements. STOLI is the initiation of a life insurance policy for the benefit of a person who, at the time of the creation of the policy, has no insurable interest in the insured.
LISA President David Hartman told attendees that the general public perception of STOLI fraud as a serious danger still remains even though a crackdown led by state regulators, industry advocates and consumer watchdogs has essentially shut down the few operators buying the illegally obtained policies as investments.
“STOLI is dead,” said Hartman. “It doesn’t exist anymore. [STOLI investors] can’t make money on it. None of the investors can take the risk of coming up with a goose egg at the end of the day.”
Conference keynote speaker Mark Penn, a former chief political strategist for Hillary Clinton, advised life settlement officials to combat negative media reports by ensuring that the industry makes its voice clearly heard in the public forum. He argued that a major reason for the current lack of faith in the financial markets is because there has not been a national economic spokesperson designated to reassure consumers.
“The best strategy is to tell your story and get the facts out there even though it is difficult to do that in this economy of fear,” said Penn, who now serves as worldwide president and CEO of Burston-Marsteller, a public relations firm.
Another major topic of conversation at the conference was the increased level of legislative activity forecast for 2009. In the past 10 months, 30 states considered legislation in life settlements and 11 of them enacted new laws. Unfortunately, all of the new bills addressing settlement regulation are often falsely labeled as just “STOLI Legislation” by life settlement opponents. LISA officials promised to work in cooperation with regulators and legislators in each state to ensure that state officials pass laws regulating life settlements, but do not infringe upon the property rights of consumers to sell their policy on the secondary market.
Representatives from consumer groups and members of academia also discussed how understanding the perception of life settlements outside of the industry can help industry players better deal with clients and suppliers. Both groups suggested that the industry should present more independent data showing how life settlements can offer valuable financial benefits for qualified seniors.
A spokesperson for AARP, the largest membership organization for people age 50 and over with more than 39 million members in the United States, claimed that improved disclosure protocols would likely help consumer awareness and improve the life settlement industry’s public image.
“We are saying that [life settlements] can be a useful tool for people making end of life decisions,” said Ryan Wilson, strategic policy advisor for AARP. “What we really think is important is that the person entering the transaction fully understands all the consequences of the transaction.”
“Consumers often have difficulty finding the answers they need because many insurers regularly attempt to hide the value of the life settlement option to the consumer,” said Doug Head, LISA’s Executive Director. “Throughout our existence, our goal has been to help further the education and financial well-being of consumers, investors and the life settlement industry — not just the insurance companies.”
About LISA
Established in 1994, the Life Insurance Settlement Association is the oldest and largest trade organization in the industry. Its goal is to promote the development, integrity, and reputation of the life settlement industry, and to promote a competitive market for the people it serves. LISA now represents 187 members with a wide variety of interests in the industry. For more about the Association, visit www.thevoiceoftheindustry.com.
Information resources:
Life Settlement Info
Life Settlement Information
Life Settlement News
Life Settlement Daily
