Basics
What does CRF stand for?
Contract Request Form
What is a Designated Contact?
(Bonus Point: Who is the only entity that cannot be one?)
Someone who will be in the remainder of Insured's life who can be contacted to obtain policy servicing information if Insured cannot be reached
Bonus: Insured's Physician
Approximately how long does it take for your client to get paid once contracts are back?
&
When is agent comp released?
2-4 weeks (depending on prefunding, RON, and clean file).
Agent comp - After we have received written COOB confirms & recission has ended.
What is a RON?
Remote Online Notary - We do a Remote Online Notary signing session with clients through the DocuSign platform
You have just found out that the agent you have been dealing with is not licensed in the state that the owner lives in. What is your next step?
Make the agent aware and advise they apply for life settlement licensing in that state immediately.
Why do we need a verification of coverage (VOC) before requesting contracts?
We need to confirm the information the agent provided is accurate at the carrier level.
E.g. policy in grace, correct SSN, correct owner/bene, etc.
If a Trust is the Policy Owner, who will sign as Owner?
Trustee(s)
What is the Suicide and Contestability period of a life insurance policy and typically how long is that period?
The contestability period is typically a 2 year window from policy start when the insurance company can investigate death claims and deny the claim if they find the policyholder intentionally lied on their life insurance application.
The suicide period references the suicide clause within the policy contract, which states that the insurance company will typically not pay a death benefit if the insured dies by suicide within the first two years of coverage.
What information do we need client to provide us on Form 10 / Insured Death Certificate Release?
Insured's:
- City/State of birth
- Insured's father's full name
- Insured's mother's full name
- Insured's mother's maiden name
The agent informs you that the Owner and Insured of the policy does not have easy access to notaries. He also lives in a state in which RON cannot be utilized. What can we offer the the agent to ease concern?
Who is the only person who can be paid for a life settlement transaction (not including the agent)?
Policy Owner
What documents are required for utilizing a POA on our contracts?
Medical POA & Financial POA.
Bonus answer: A declined LOC if applicable
What is the rescission period of a life settlement?
Bonus: Name a form of our Contract that outlines rescission
A specific timeframe, as governed by state law, during which the seller of a life insurance policy has the right to cancel the life settlement agreement without facing any adverse consequences, and the seller is required to return the settlement proceeds they received within that timeframe.
Bonus: Form 3, Form 8
Name one state that does not allow Contract signers to utilize DocuSign
SC, MA, GA
The client has stage 4 stomach cancer, and his LE is less than 24 months. You present an offer to him which he accepts. You pass him over to your closing specialist, who will begin gathering closing information in order to request contracts. Celeste finds on the CLEAR that the client has a criminal record including multiple instances of child abuse and neglect. Is there any way to move forward with buying this client's policy?
No.
True or False: If the agent is a notary, they can always notarize the client's contract.
False. This is only allowed if they aren't taking commission and not listed on the contract anywhere.
Note: They can NOT act as a disinterested witness.
Why do we need to review a full copy of a Trust when it is the Policy Owner or Beneficiary?
(Multiple answers; bonus points for each one you get).
- We need to confirm who will be signing off as Owner or Bene (Trustee)
- Confirm Trust information we have is what the Carrier has as well
-Confirm situs state
-To make sure the trust is legally able to sell the policy
How often can Policy Servicing reach out to an Insured per year?
4 times, quarterly
Name one form of our Contract that requires a wet signature?
Form 5, 6, 11, Carrier/change forms
(Also form 21 and 24 if applicable)
Your client Jen claims to be the Owner of the policy we have valued and offered on. To her knowledge, she is the Owner, her mom Lydia is the Insured, and the Beneficiary is The Lydia Smith Revocable Trust, and the Trustee is Jen's brother Jeff. When Alexa and Jen attempt to complete the VOC, the carrier refuses to provide authorization saying that Jen is not the Owner of the policy so they cannot complete the call. Based on the info you have, who do you think the Owner is and who would be the only person that could authorize Abacus?
The Owner of the policy is probably the Trust. Jeff, as the Trustee, would be the only person who is authorized to receive information and make policy changes.
Under what circumstances would a Policy Owner qualify for a 1099-LTC?
If Insured is terminally ill (less than 24 month LE) or if Insured cannot perform 2 out of 5 ADL's
Form 7 of our Contract is the Insured's LOC. What is an LOC and why is it necessary?
Letter of Competency
Need Insured's doctor to sign off that they believe the insured is competent in their medical opinion and is capable of making their own financial decisions
Organize these steps in chronological order:
1. Final Legal Review
2. Release of Funds to Owner
3. Funding Escrow
4. CRF/Verification of Coverage Call
5. Draft Contracts & Send to agent.
6. Submit COO/COB Forms to Carrier
7. Initial Due Diligence Review
8. Client Signs Contract
4, 5, 8, 7, 1, 3, 2, 6
Would Accept:
4, 5, 8, 7, 1, 3, 6, 2
**Assuming individual owner/bene with clean COT.
Name each person/title who has to sign our life settlement contract?
(7 total answers, points awarded 4)
(Bonus points for more than 4)
1. Owner
2. Insured
3. Beneficiary
4. Agent
5. Designated Contacts
6. Physician
7. Spouse!!!
Phyllis accepted your offer and has moved to Closing. After the VOC is completed, we find out that her policy was previously owned by her ex-husband and Phyllis was made the owner in 1990. Phyllis asks you, why does it matter that my ex owned this policy since I am the Owner now and have all the rights to the policy?
Fund needs to ensure a clean chain of title; especially if there is a chance that the owner could not legally sell the policy to us.