Iowa Life Settlements
In 2008, legislature made some major adjustments in the Iowa life settlement market. The state now allows life insurance producers to perform life settlement transactions as a broker without proper licensing. This is contrary to many of the other state bills that have been passed around the nation that require all life settlement transactions to be completed by a specifically state licensed life settlement broker.
A Iowa life settlement or viatical broker and their corresponding provider must formulate an anti-fraud plan to be produced for review. These plan regulations are used in the detection and prevention of life insurance fraud in an Iowa life settlement. The Iowa life settlement laws also prohibit the sale of Stranger Owned Life Insurance, commonly referred to as a STOLI agreement, by a third party who has no insurable interest in the current policy holder.
A life or viatical settlement allows qualified policy holders the option to sell their unwanted, unneeded or unaffordable life insurance policies to individual third party investors or investor groups. If an Iowa life settlement is made and signed, the cash settlement can present a productive option to the policy holder compared to the alternative of cashing out the policy for the surrender cash value or allowing a term policy to lapse and lose all value.