{"data":{"id":"us-ky/krs-304.15-715","jurisdiction":"us-ky","citation":"KRS 304.15-715","heading":"Requirements for life settlement contracts.","body":"(1) A life settlement provider entering into a life settlement contract with any person\nshall first obtain:\n(a) If the owner is insured, a written statement from a licensed attending\nphysician that the owner is of sound mind and under no constraint or undue\ninfluence to enter into a life settlement contract; and\n(b) A document in which the insured consents to the release of his or her medical\nrecords to a life settlement provider, life insurance agent, or life settlement\nbroker and, if the policy was issued les s than two (2) years from the date of\napplication for a life settlement contract, to the insurance company that issued\nthe policy.\n(2) The insurer shall respond to a request for verification of coverage submitted by a\nlife settlement provider or life settl ement broker not later than thirty (30) calendar\ndays after the date the request is received. The request for verification of coverage\nshall be made on a form approved by the commissioner. The insurer shall complete\nand issue the verification of coverage o r indicate in which respects it is unable to\nrespond. In its response, the insurer shall indicate whether, based on the medical\nevidence and documents provided, the insurer intends to pursue an investigation at\nthat time regarding the validity of the insurance contract or possible fraud, and shall\nprovide sufficient detail of all reasons for the investigation to the life settlement\nprovider or life settlement broker.\n(3) Prior to or at the time of execution of the life settlement contract, the life settleme nt\nprovider shall obtain a witnessed document in which the owner consents to the life\nsettlement contract, represents that he or she has a full and complete understanding\nof the life settlement contract and a full and complete understanding of the benefits\nof the policy, and acknowledges that he or she has entered into the life settlement\ncontract freely and voluntarily and, for persons with a terminal or chronic illness or\ncondition, that the terminal or chronic illness or condition was diagnosed after the\npolicy was issued.\n(4) All medical information solicited or obtained by any licensee shall be subject to the\napplicable provision of state law relating to confidentiality of medical information.\n(5) All life settlement contracts entered into in this state  shall contain an unconditional\nright to rescind a life settlement contract before the earlier of thirty (30) calendar\ndays after the date it is executed or fifteen (15) calendar days after the date of\nreceipt of the proceeds of the life settlement contrac t by the owner. If exercised by\nthe owner, rescission is effective only if both notice of the rescission is given, and\nwithin the rescission period all proceeds, and any premiums, loans, and loan interest\nare repaid to the life settlement provider. If the insured dies during the rescission\nperiod, the life settlement contract shall be deemed to have been rescinded subject\nto repayment of all proceeds and any premiums, loans, and loan interest to the life\nsettlement provider. The life settlement provider sha ll effectuate the change of\nownership of the policy or certificate to the owner immediately upon effective\nrescission by the owner.\n(6) The independent third -party trustee shall transfer the proceeds that are due to the\nowner within two (2) business days u pon receipt of acknowledgment of the transfer\nof ownership from the insurer.\n(7) Failure to tender consideration to the owner for the life settlement contract by the\ndate disclosed renders the life settlement contract voidable by the owner for lack of\nconsideration until the time consideration is tendered to and accepted by the owner.\n(8) Contacts with the insured for the purpose of determining the health status of the\ninsured after the execution of the life settlement contract shall only be made by the\nlife settlement provider or its authorized representative and shall be limited to once\nevery three (3) months for an insured with a life expectancy of more than one (1)\nyear, and to no more than once per month for an insured with a life expectancy of\none (1) year or less. The life settlement provider shall explain the procedure for\nthese contacts at the time the life settlement contract is entered into. The limitations\nset forth in this subsection shall not apply to any contacts with an insured for\nreasons other than determining the insured's health status. Life settlement providers\nshall be responsible for the actions of their authorized representatives.\n(9) The insurer shall not unreasonably delay effecting change of ownership or\nbeneficiary with any life set tlement contract lawfully entered into in the\nCommonwealth or with a resident of the Commonwealth.\n(10) If a life settlement broker performs any activities required of the provider under this\nsection, the provider is deemed to have fulfilled those requirem ents of this section\nthat have been properly performed by the broker.\n(11) If a life settlement broker performs any of the disclosure activities required of the\nprovider under KRS 304.15 -710, the provider is deemed to have fulfilled those\nrequirements of KRS 304.15-710 that have been properly performed by the broker.\n(12) Within twenty (20) days after an owner executes the life settlement contract, the\nprovider shall give written notice to the insurer that issued that insurance policy that\nthe policy has be come subject to a life settlement contract. The notice shall be\naccompanied by the documents required by KRS 304.15-702(1)(b).\n(13) Any fee paid by a provider, party, individual, or an owner to a broker in exchange\nfor services provided to the owner pertaining to a life settlement contract shall be\ncomputed as a percentage of the offer obtained, not the face value of the policy.\nNothing in this section shall be construed as prohibiting a broke r from reducing\nsuch broker's fee below this percentage if the broker so chooses.\n(14) The broker shall disclose to the owner anything of value paid or given to a broker\nwhich relates to a life settlement contract.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=17254","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:57:44Z","sha256":"0446206c9f11ed9061195d2f73920cdf5496abdda0525eaeafe751aea39bd5ed","source_id":"us-ky","stale":false,"prev":"us-ky/krs-304.15-712","next":"us-ky/krs-304.15-716"},"notice":"GroundRules: Original legal text. Not legal advice."}