HB632 Summary: Life Settlements Act

• Establishes licensure requirements for providers and brokers of life settlement contracts, with the Commissioner of Insurance enforcing regulations and suspending/revoking licenses for violations.

• Requires life settlement contracts and disclosure forms to be filed with and approved by the commissioner, and mandates providers submit annual statements on settled policies to the commissioner.

• Prohibits life settlement contracts during the first two years after policy issuance unless the owner certifies specific qualifying events occurred (terminal/chronic illness, divorce, retirement, bankruptcy, etc.).

• Requires comprehensive written disclosures to owners including alternatives to settlement, tax implications, creditor claims, public assistance impacts, rescission rights within 30 days, and fraud warnings.

• Criminalizes fraudulent life settlement acts as a Class A misdemeanor and establishes civil penalties up to $10,000 per violation, with provisions protecting those who report suspected fraud in good faith.