viatical settlement


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Related to viatical settlement: Viatical Settlement Company

viatical settlement

The purchase—at a discount—of a life insurance policy from a gravely ill patient. The buyer becomes the beneficiary of the policy; the viator receives a lump sum payment before dying.
See also: settlement
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References in periodicals archive ?
The primary subject matter of this case concerns viatical settlements.
The Health Insurance Portability and Accountability Act of 1996 (HIPAA) established guidelines that make the proceeds from a viatical settlement federal income tax free.
The DOI revoked the provider's license to operate as a viatical settlement provider.
Virginia enacted its Viatical Settlements Act in 1997 to address the state's concern with the "potential for exploitation of vulnerable and seriously ill individuals.
5) If the insured actually lives months, years, or decades longer than expected, the accelerated benefits or viatical settlement continue to be excluded from income.
The settlement process begins when the viator executes a viatical settlement application and provides authorization to the insured's attending physician and the issuing insurance company to disclose confidential information pertaining to the insured's health and insurance coverage.
As in all markets for mortality contingent contracts, viatical settlement firms need to know the health of consumers to derive the actuarially fair price.
One way to defraud the investor is to sell a viatical knowing that the insured lied about his or her health condition when applying for the policy, as did one Florida viatical settlement company.
Senior Life Benefits and viatical settlements were introduced to the membership a year ago.
Nearly every type of life insurance policy qualifies for a viatical settlement, providing it's been in force for at least two years.
8) The initial sale of life insurance policies by terminally ill policyholders, known as viators,(9) to viatical settlement companies is subject to varying amounts of regulation at the state level, typically by a state's insurance department.
Prior to the insurance industry entering into this market, private investors formed groups commonly known as Viatical settlement companies for the purpose of purchasing, or taking assignments of, policies at a discount owned by the terminally ill.