(1) Except as hereinafter provided, if a viatical settlement contract is entered into within the 2-year period commencing with the date of issuance of the insurance policy or certificate to be acquired, the viatical settlement contract is void and unenforceable by either party.
(2) Except as hereinafter provided, if a viatical settlement policy is subject to a loan secured directly or indirectly by an interest in the policy within a 5-year period commencing on the date of issuance of the policy or certificate, the viatical settlement contract is void and unenforceable by either party.
(3) Notwithstanding the limitations in subsections (1) and (2), such a viatical settlement contract is not void and unenforceable if the viator provides a sworn affidavit and accompanying independent evidentiary documentation certifying to the viatical settlement provider that one or more of the following conditions were met during the periods applicable to the viaticated policy as stated in subsection (1) or subsection (2):

(a) The policy was issued upon the owner’s exercise of conversion rights arising out of a group or term policy, if the total time covered under the prior policy is at least 60 months. The time covered under a group policy must be calculated without regard to any change in insurance carriers, provided the coverage has been continuous and under the same group sponsorship.

Terms Used In Florida Statutes 626.99287

  • Affidavit: A written statement of facts confirmed by the oath of the party making it, before a notary or officer having authority to administer oaths.
  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • Contract: A legal written agreement that becomes binding when signed.
  • Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
  • Jurisdiction: (1) The legal authority of a court to hear and decide a case. Concurrent jurisdiction exists when two courts have simultaneous responsibility for the same case. (2) The geographic area over which the court has authority to decide cases.
  • person: includes individuals, children, firms, associations, joint adventures, partnerships, estates, trusts, business trusts, syndicates, fiduciaries, corporations, and all other groups or combinations. See Florida Statutes 1.01
  • Recourse: An arrangement in which a bank retains, in form or in substance, any credit risk directly or indirectly associated with an asset it has sold (in accordance with generally accepted accounting principles) that exceeds a pro rata share of the bank's claim on the asset. If a bank has no claim on an asset it has sold, then the retention of any credit risk is recourse. Source: FDIC
  • Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
  • Trustee: A person or institution holding and administering property in trust.
(b) The owner of the policy is a charitable organization exempt from taxation under 26 U.S.C. § 501(c)(3).
(c) The viator certifies by producing independent evidence to the viatical settlement provider that one or more of the following conditions were met:

1. The viator or insured is terminally or chronically ill and the condition was not known to the insured at the time the life insurance contract was entered into;
2. The viator’s spouse dies;
3. The viator divorces his or her spouse;
4. The viator retires from full-time employment;
5. The viator becomes physically or mentally disabled and a physician determines that the disability prevents the viator from maintaining full-time employment;
6. The owner of the policy was the insured’s employer at the time the policy or certificate was issued and the employment relationship terminated;
7. A final order, judgment, or decree is entered by a court of competent jurisdiction, on the application of a creditor of the viator, adjudicating the viator bankrupt or insolvent, or approving a petition seeking reorganization of the viator or appointing a receiver, trustee, or liquidator to all or a substantial part of the viator’s assets; or
8. The viator experiences a significant decrease in income which is unexpected by the viator and which impairs his or her reasonable ability to pay the policy premium.
(d) The viator entered into a viatical settlement contract more than 2 years after the policy’s issuance date and, with respect to the policy, at all times before the date that is 2 years after policy issuance, each of the following conditions is met:

1. Policy premiums have been funded exclusively with unencumbered assets, including an interest in the life insurance policy being financed only to the extent of its net cash surrender value, provided by, or fully recourse liability incurred by, the insured;
2. There is no agreement or understanding with any other person to guarantee any such liability or to purchase, or stand ready to purchase, the policy, including through an assumption or forgiveness of the loan; and
3. Neither the insured or the policy has been evaluated for settlement.
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