A. A provider or broker shall provide a written disclosure statement form containing the following information to the viator no later than the time of application:

(1) possible alternatives to viatical settlement contracts for persons with catastrophic, life-threatening or chronic illnesses, including any accelerated death benefits offered under the viator's life insurance policy;

(2) that some or all of the proceeds of the viatical settlement may be free from federal income tax and from state franchise and income taxes, and that assistance should be sought from a professional tax adviser;

(3) that the viator has a right to rescind a viatical settlement contract within fifteen calendar days after receipt of the viatical settlement proceeds;

(4) that money will be sent to the viator within two business days after the provider has received the insurer or group administrator's acknowledgment that ownership of the policy or interest in the certificate has been transferred and the beneficiary has been designated pursuant to the viatical settlement contract;

(5) that proceeds of the viatical settlement could be subject to the claims of creditors;

(6) that receipt of the proceeds of a viatical settlement may adversely affect the viator's eligibility for medicaid or other government benefits or entitlements, and that advice should be obtained from the appropriate government agencies; and

(7) that entering into a viatical settlement contract may cause other rights or benefits, including conversion rights and waiver of premium benefits that may exist under the policy or certificate, to be forfeited by the viator and that assistance should be sought from a financial adviser.

B. A provider shall disclose in writing the following information to the viator prior to the date the viatical settlement contract is signed by all parties:

(1) the affiliation, if any, between the provider and the issuer of an insurance policy to be viaticated;

(2) if an insurance policy to be viaticated has been issued as a joint policy or involves family riders or any coverage of a life other than the viator, the possible loss of coverage on the other lives and the advisability of consulting with the insurance producer or the company issuing the policy for advice on the proposed viatication; and

(3) the dollar amount of the current death benefit payable to the provider under the policy or certificate and the availability of any additional guaranteed insurance benefits and the dollar amount of any accidental death and dismemberment benefits under the policy or certificate and the provider's interest in those benefits.

History: Laws 1999, ch. 246, § 8.

Effective dates. — Laws 1999, ch. 246, § 13, made the Viatical Settlements Act effective July 1, 2000.