North Dakota lawmakers have approved H.B. 1284, a bill that would strengthen a state law prohibiting stranger-originated life insurance transactions.
The bill, H.B. 1284, would define a STOLI arrangement as a fraudulent transaction in which financial speculators persuade a senior to buy life insurance with the specific intention of transferring the death benefits to the speculators.
The bill also would require life settlement providers to give cost information and other relevant information to seniors considering life settlement transactions, and it would require life settlement providers to submit information about their deals to the state insurance department.
The bill would permit life insurers to ask policy application questions designed to help underwriters detect STOLI transactions.
