Some life insurers are rewriting policies to restrict use of premium financing.
Gregory Serio, managing director in the Albany, N.Y., office of Park Strategies L.L.C., talked about that trend here today at a conference organized by the Life Insurance Finance Association, Atlanta.
Serio, the former New York state insurance superintendent, told an audience of about 250 attendees that some life insurers appear to be including restrictions on use of premium financing in "file and use" policy forms rather than in forms that require approval from state insurance commissioners.
One large insurer has added a "public policy" provision that talks about the need to protect the interests of other policyholders, Serio said.
Some insurers' policy provisions appear to be putting premium financing in a category of "nefarious activities," Serio said.
When policy language starts to remove the presumption of innocence from regulators' minds, that can have a chilling effect, Serio said.
Many efforts to prevent use of premium financing are aimed at applicants over age 65, according to Larry Anders, chief executive of Summit Alliance Companies, Dallas.
