On May 23, 10:10 am, beliav...@[EMAIL PROTECTED]
wrote:
> On May 23, 9:41 am, kastnna <kast...@[EMAIL PROTECTED]
> wrote:
>
>
>
>
>
> > On May 21, 6:47 pm, "Coffee's For Closers" <Usenet2...@[EMAIL PROTECTED]
>
> > IN.SIG> wrote:
> > > In article <0d3v24tnas559tfuh8ime592u8blchk...@[EMAIL PROTECTED]
>,
> > > p...@[EMAIL PROTECTED]
says...
>
> > > > beliav...@[EMAIL PROTECTED]
wrote:
> > > > > Looking at some ads run enticing people
> > > > >to sell their life insurance policies, the rates of return for
> > > > >investors look high.
> > > > They are if the guy has the good manners to die promptly. If
> > > > he lives too long, the returns go in the tank.
>
> > > I seem to recall that happening about ten years ago. People with
> > > AIDs were getting these kind of loans. The idea was that, death
> > > was pretty much guaranteed within a few years. Then, advances in
> > > medications enabled some of them physically improve, and keep
> > > living on and on. Especially since so many of them were
> > > relatively young, and may have been in decent health before the
> > > AIDS symptoms started.
>
> > > I wonder if there are investors out there, still waiting.
>
> > Yes there are, but I wouldn't be too worried about them. They are
> > still making a hefty profit. Most AIDS victims are very young, so the
> > premium payments are low. Furthermore, most of the terminal patients
> > were in such dire financial straits that they were paid only a
> > fraction of the fair market value of their policies.
>
> > The abusers who too advantage of these terminally ill patients are
> > definitely seeing lower returns than expected, but they're probably
> > still making more than the average investor.
>
> The "abusers" were willing to pay more for the policies than the life
> insurance companies were (the "cash value"), or the insureds would not
> have sold their policies to them. Unless you have some evidence of
> misrepresentation or fraud, I think you are smearing people.
I'm all for providing secondary markets and liquidity. I also believe
that most people "get what they got comin' to 'em". But the viatical
industry used outright lies, deception, and fraud to trick both
investors and insurance policyholders.
>From a United States Postal Service consumer alert:
...Like thousands of others around the United States, Tracton invested
in a billion-dollar industry rife with fraud and unregulated by the
federal government or, until recently, most states. In fact,
corruption in the viaticals industry was so widespread in the mid- to
late-1990s, federal law enforcement officials formed a task force to
combat it. In the last two years alone, federal and state authorities
have issued 78 indictments, 57 of which resulted in convictions.
Or from the AARP website:
http://www.aarp.org/money/credit_debt/a2002-10-01-FraudsViaticals.html
Even the National Association of Insurance Commissioners warns
potnetial policy-sellers:
http://www.naic.org/consumer_life_viaticals_seller.htm
Did I forget to mention that almost all policies, including term
(which has no cash value), are now issued with an "accelerated benefit
rider" (it's free). The rider allows for up to 50% of the face value
to be withdrawn prior to death in the event that the insured is
declared terminally ill by a licensed physician. The remaining 50% is
paid to the beneficiaries as intended.
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