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State Representative Joe Atkins
100 Rev. Dr. Martin Luther King Jr. Blvd.
651-296-4192
For more information contact: Matt Swenson 651-297-8406
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HOUSE PASSES MEASURE PROTECTING MINNESOTANS FROM LIFE INSURANCE SCAMS
ST. PAUL, MN - With unanimous, bipartisan support, the Minnesota House of Representatives approved nation-leading legislation (HF1719) today that would help protect Minnesotans from being taken advantage of should they decide to sell their life insurance policies in a viatical settlement. Widespread fraud and abuse in the viaticals market has caused considerable concern that vulnerable people were being scammed due to lax regulation of the practice. The bill passed today would change that.
“Viatical settlements are perfectly legitimate," said the bill’s author Rep. Joe Atkins, who chairs the House Commerce and Labor Committee. “In a person’s final months of life, sometimes turning over one’s life insurance for some additional cash can help purchase treatments that will make those final months more comfortable. In other cases, selling your life insurance is the only option available in a difficult financial situation. Still, basic protections are needed to make certain these people aren’t being taken advantage of. That’s what this bill does.”
Viatical settlements rose to prominence in the 1980s when AIDS patients sold their insurance policies for cash so they could purchase expensive anti-AIDS medication or enjoy the last few months of their lives. In the 1990s, numerous reports surfaced of unscrupulous companies selling viaticals along with bogus medical reports on the insured’s health status. In some cases, the executives for these viatical companies and the doctors they hired faced criminal charges and were sent to prison.
“There are appropriate situations where viaticals may be a reasonable option,” said Atkins. “But we need to ensure that consumers are not unfairly taken advantage of when they happen.”
Atkins’ bill replaces existing viaticals law with a version that is recommended by the National Association of Insurance Commissioners (NAIC). The bill contains numerous provisions including: 1) license and bond requirements; 2) reporting requirements; 3) disclosure requirements; 4) a requirement that Department of Commerce approve contracts and disclosure forms; and 5) prohibited practices.
News Items
- Rep. Atkins, Sen. Lourey Introduce Health Insurance Exchange Legislation - (Posted: Jan 9 2013 3:44PM)
- Rep. Atkins – Statement on Deal to End NHL Lockout - (Posted: Jan 7 2013 2:05PM)
- Rep. Atkins to Hold Minnesota House Hearing on Economic Impact of Hockey Lockout - (Posted: Jan 2 2013 3:20PM)
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