Okla. Stat. tit. 36, § 36-4055.2

As used in the Viatical Settlements Act of 2008:

1. “Advertising” means any written, electronic or printed

communication or any communication by means of recorded telephone

messages or transmitted on radio, television, the Internet or

similar communications media, including film strips, motion pictures

and videos, published, disseminated, circulated or placed directly

before the public, in this state, for the purpose of creating an

interest in or inducing a person to sell, assign, devise, bequest or

transfer the death benefit or ownership of a life insurance policy

pursuant to a viatical settlement contract;

2. “Business of viatical settlements” means an activity

involved in, but not limited to, the offering, soliciting,

negotiating, procuring, effectuating, purchasing, investing,

financing, monitoring, tracking, underwriting, selling,

transferring, assigning, pledging, hypothecating or in any other

manner acquiring an interest in a life insurance policy by means of

a viatical settlement contract;

3. “Chronically ill” means:

a. being unable to perform at least two activities of

daily living, including, but not limited to, eating,

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toileting, transferring, bathing, dressing or

continence,

b. requiring substantial supervision to protect the

individual from threats to health and safety due to

severe cognitive impairment, or

c. having a level of disability similar to that described

in subparagraph a of this paragraph as determined by

the Secretary of Human Services;

4. “Commissioner” means the Insurance Commissioner of the State

of Oklahoma;

5. “Financing entity” means an underwriter, placement agent,

lender, purchaser of securities, purchaser of a policy or

certificate from a viatical settlement provider, credit enhancer, or

any entity that has a direct ownership in a policy or certificate

that is the subject of a viatical settlement contract, but:

a. whose principal activity related to the transaction is

providing funds to effect the viatical settlement or

purchase of one or more viaticated policies, and

b. who has an agreement in writing with one or more

licensed viatical settlement providers to finance the

acquisition of viatical settlement contracts.

Financing entity does not include a nonaccredited investor or a

viatical settlement purchaser;

6. “Financing transaction” means a transaction in which a

licensed provider obtains financing from a financing entity,

including, without limitation, any secured or unsecured financing,

any securitization transaction, or any securities offering which

either is registered or exempt from registration under federal and

state securities law;

7. “Fraudulent viatical settlement act” includes:

a. acts or omissions committed by any person who,

knowingly and with intent to defraud, for the purpose

of depriving another of property or for pecuniary

gain, commits, or permits its employees or its agents

to engage in acts including:

(1) presenting, causing to be presented or preparing

with knowledge or belief that it will be

presented to or by a viatical settlement

provider, viatical settlement broker, viatical

settlement purchaser, financing entity, insurer,

insurance producer or any other person, false

material information, or concealing material

information, as part of, in support of or

concerning a fact material to one or more of the

following:

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(a) an application for the issuance of a

viatical settlement contract or insurance

policy,

(b) the underwriting of a viatical settlement

contract or insurance policy,

(c) a claim for payment or benefit pursuant to a

viatical settlement contract or insurance

policy,

(d) premiums paid on an insurance policy,

(e) payments and changes in ownership or

beneficiary made in accordance with the

terms of a viatical settlement contract or

insurance policy,
contract or insurance

policy,

(b) the underwriting of a viatical settlement

contract or insurance policy,

(c) a claim for payment or benefit pursuant to a

viatical settlement contract or insurance

policy,

(d) premiums paid on an insurance policy,

(e) payments and changes in ownership or

beneficiary made in accordance with the

terms of a viatical settlement contract or

insurance policy,

(f) the reinstatement or conversion of an

insurance policy,

(g) in the solicitation, offer, effectuation or

sale of a viatical settlement contract or

insurance policy,

(h) the issuance of written evidence of viatical

settlement contract or insurance, or

(i) a financing transaction,

(2) intentionally failing to disclose to the insurer

when requested by the insurer that the

prospective insured has knowingly undergone a

life expectancy evaluation by any person or

entity other than the insured or its authorized

representatives in connection with the issuance

of the policy,

(3) in the solicitation, application or issuance of a

life insurance policy, employing any device,

scheme or artifice in violation of Section 3604

of Title 36 of the Oklahoma Statutes, and

(4) employing any plan, financial structure, device,

scheme, or artifice to defraud related to

viaticated policies,

b. in the furtherance of a fraud or to prevent the

detection of a fraud any person commits or permits its

employees or its agents to:

(1) remove, conceal, alter, destroy or sequester from

the Commissioner the assets or records of a

licensee or other person engaged in the business

of viatical settlements,

(2) misrepresent or conceal the financial condition

of a licensee, financing entity, insurer or other

person,

(3) transact the business of viatical settlements in

violation of laws requiring a license,

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certificate of authority or other legal authority

for the transaction of the business of viatical

settlements, or

(4) file with the Commissioner or the equivalent

chief insurance regulatory official of another

jurisdiction a document containing false

information or otherwise conceals information

about a material fact from the Commissioner,

c. embezzlement, theft, misappropriation or conversion of

monies, funds, premiums, credits or other property of

a viatical settlement provider, insurer, insured,

viator, insurance policyowner or any other person

engaged in the business of viatical settlements or

insurance,

d. recklessly entering into, negotiating, brokering,

otherwise dealing in a viatical settlement contract,

the subject of which is a life insurance policy that

was obtained by presenting false information

concerning any fact material to the policy or by

concealing, for the purpose of misleading another,

information concerning any fact material to the

policy, where the person or the persons intended to

defraud the policy’s issuer, the viatical settlement

provider or the viator. Recklessly means engaging in

the conduct in conscious and clearly unjustifiable

disregard of a substantial likelihood of the existence

of the relevant facts or risks, such disregard

involving a gross deviation from acceptable standards

of conduct,

e. stranger-originated life insurance,

f. facilitating the change of state of ownership of a

policy or certificate or the state of residency of a

viator to a state or jurisdiction that does not have a

law similar to this act for the express purposes of

evading or avoiding the provisions of the Viatical

Settlements Act of 2008, or

g. attempting to commit, assisting, aiding or abetting in

the commission of, or conspiracy to commit the acts or

omissions specified in this paragraph;

8. “Life insurance producer” means any person licensed in this

state as a resident or nonresident insurance producer who has

received qualification or authority for life insurance coverage or a
ons of the Viatical

Settlements Act of 2008, or

g. attempting to commit, assisting, aiding or abetting in

the commission of, or conspiracy to commit the acts or

omissions specified in this paragraph;

8. “Life insurance producer” means any person licensed in this

state as a resident or nonresident insurance producer who has

received qualification or authority for life insurance coverage or a

life line of coverage pursuant to the Oklahoma Producer Licensing

Act;

9. “Person” means a natural person or a legal entity,

including, without limitation, an individual, partnership, limited

liability company, association, trust, or corporation;

Oklahoma Statutes - Title 36. Insurance Page 868

10. “Policy” means an individual or group policy, group

certificate, contract or arrangement of life insurance owned by a

resident of this state, regardless of whether delivered or issued

for delivery in this state;

11. “Related provider trust” means a titling trust or other

trust established by a licensed viatical settlement provider or a

financing entity for the sole purpose of holding the ownership or

beneficial interest in purchased policies in connection with a

financing transaction. The trust shall have a written agreement

with the licensed viatical settlement provider under which the

licensed viatical settlement provider is responsible for ensuring

compliance with all statutory and regulatory requirements and under

which the trust agrees to make all records and files related to

viatical settlement transactions available to the Commissioner as if

those records and files were maintained directly by the licensed

viatical settlement provider;

12. “Special purpose entity” means a corporation, partnership,

trust, limited liability company or other similar entity formed

solely to provide either directly or indirectly access to

institutional capital markets:

a. for a financing entity or licensed viatical settlement

provider, or

b. (1) in connection with a transaction in which the

securities in the special purposes entity are

acquired by the viator or by “qualified

institutional buyers” as defined in Rule 144

promulgated under the Federal Securities Act of

1933, as amended, or

(2) the securities pay a fixed rate of return

commensurate with established asset-backed

institutional capital markets;

13. “Stranger-originated life insurance” means a practice or

plan to initiate a life insurance policy for the benefit of a third-

party investor who, at the time of policy origination, has no

insurable interest in the insured. Stranger-originated life

insurance practices include, but are not limited to, cases in which

life insurance is purchased with resources or guarantees from or

through a person or entity who, at the time of policy inception,

could not lawfully initiate the policy, and where, at the time of

policy inception, there is an arrangement or agreement, whether

verbal or written, to directly or indirectly transfer the ownership

of the policy or the policy benefits to a third party. Trusts that

are created to give the appearance of insurable interest and are

used to initiate policies for investors violate Section 3604 of

Title 36 of the Oklahoma Statutes and the prohibition against

wagering on human life. Stranger-originated life insurance

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arrangements do not include the practices provided in subparagraph b

of paragraph 15 of this section;

14. “Terminally ill” means having an illness or sickness that

can reasonably be expected to result in death in twenty-four (24)

months or less;

15. “Viatical settlement broker” means a person, including a

life insurance producer as provided for in Section 3 of Enrolled

Senate Bill No. 1980 of the 2nd Session of the 51st Oklahoma

Legislature, who working exclusively on behalf of a viator and for a

fee, commission or other valuable consideration, offers or attempts
bly be expected to result in death in twenty-four (24)

months or less;

15. “Viatical settlement broker” means a person, including a

life insurance producer as provided for in Section 3 of Enrolled

Senate Bill No. 1980 of the 2nd Session of the 51st Oklahoma

Legislature, who working exclusively on behalf of a viator and for a

fee, commission or other valuable consideration, offers or attempts

to negotiate viatical settlement contracts between a viator and one

or more viatical settlement providers or one or more viatical

settlement brokers. Notwithstanding the manner in which the

viatical settlement broker is compensated, a viatical settlement

broker is deemed to represent only the viator, and not the insurer

or the viatical settlement provider, and owes a fiduciary duty to

the viator to act according to the viator’s instructions and in the

best interest of the viator. The term does not include an attorney,

certified public accountant or a financial planner accredited by a

nationally recognized accreditation agency, who is retained to

represent the viator and whose compensation is not paid directly or

indirectly by the viatical settlement provider or purchaser;

16. “Viatical settlement contract” means a written agreement

between a viator and a viatical settlement provider or any affiliate

of the viatical settlement provider establishing the terms under

which compensation or anything of value is or will be paid, which

compensation or value is less than the expected death benefits of

the policy, in return for the viator’s present or future assignment,

transfer, sale, devise or bequest of the death benefit or ownership

of any portion of the insurance policy or certificate of insurance.

Viatical settlement contract also means the transfer for

compensation or value of ownership or beneficial interest in a trust

or other entity that owns such policy if the trust or other entity

was formed or availed of for the principal purpose of acquiring one

or more life insurance contracts, which life insurance contracts

insure the life of a person residing in this state.

a. Viatical settlement contract includes a premium

finance loan made for a life insurance policy by a

lender to viator on, before or less than two (2) years

after the date of issuance of the policy where:

(1) the viator or the insured receives on the date of

the premium finance loan a guarantee of a future

viatical settlement value of the policy, or

(2) the viator or the insured agrees on the date of

the premium finance loan to sell the policy or

any portion of its death benefit on any date

following the issuance of the policy.

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b. Viatical settlement contract does not include:

(1) a policy loan or accelerated death benefit made

by the insurer pursuant to the policy’s terms,

(2) loan proceeds that are used solely to pay:

(a) premiums for the policy, and
ance loan to sell the policy or

any portion of its death benefit on any date

following the issuance of the policy.

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b. Viatical settlement contract does not include:

(1) a policy loan or accelerated death benefit made

by the insurer pursuant to the policy’s terms,

(2) loan proceeds that are used solely to pay:

(a) premiums for the policy, and

(b) the costs of the loan, including, without

limitation, interest, arrangement fees,

utilization fees and similar fees, closing

costs, legal fees and expenses, trustee fees

and expenses, and third-party collateral

provider fees and expenses, including fees

payable to letter of credit issuers,

(3) a loan made by a bank or other licensed financial

institution in which the lender takes an interest

in a life insurance policy solely to secure

repayment of a loan or, if there is a default on

the loan and the policy is transferred, the

transfer of such a policy by the lender, provided

that neither the default on the loan nor the

transfer of the policy in connection with the

default is pursuant to an agreement or

understanding with any other person for the

purpose of evading regulation under this act,

(4) a loan made by a lender that does not violate

Sections 4-101 through 4-304 of Title 14A of the

Oklahoma Statutes, provided that the premium

finance loan is not described in this

subparagraph,

(5) an agreement where all the parties:

(a) are closely related to the insured by blood

or law, or

(b) have a lawful substantial economic interest

in the continued life, health and bodily

safety of the person insured, or are trusts

established primarily for the benefit of

such parties,

(6) any designation, consent or agreement by an

insured who is an employee of an employer in

connection with the purchase by the employer, or

trust established by the employer, of life

insurance on the life of the employee,

(7) a bona fide business succession planning

arrangement:

(a) between one or more shareholders in a

corporation or between a corporation and one

or more of its shareholders or one or more

trusts established by its shareholders,

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(b) between one or more partners in a

partnership or between a partnership and one

or more of its partners or one or more

trusts established by its partners, or

(c) between one or more members in a limited

liability company or between a limited

liability company and one or more of its

members or one or more trusts established by

its members,

(8) an agreement entered into by a service recipient,

or a trust established by the service recipient,

and a service provider, or a trust established by

the service provider, who performs significant

services for the service recipient’s trade or

business, or
lity company or between a limited

liability company and one or more of its

members or one or more trusts established by

its members,

(8) an agreement entered into by a service recipient,

or a trust established by the service recipient,

and a service provider, or a trust established by

the service provider, who performs significant

services for the service recipient’s trade or

business, or

(9) any other contract, transaction or arrangement

exempted from the definition of viatical

settlement contract by the Commissioner based on

a determination that the contract, transaction or

arrangement is not of the type intended to be

regulated by the Viatical Settlements Act of

2008;

17. “Viatical settlement provider” means a person, other than a

viator, that enters into or effectuates a viatical settlement

contract with a viator resident in this state. Viatical settlement

provider does not include:

a. a bank, savings bank, savings and loan association,

credit union or other licensed lending institution

that takes an assignment of a life insurance policy

solely as collateral for a loan,

b. a premium finance company making premium finance loans

and exempted by the Commissioner from the licensing

requirement under the premium finance laws that takes

an assignment of a life insurance policy solely as

collateral for a loan,

c. the issuer of the life insurance policy,

d. an authorized or eligible insurer that provides stop

loss coverage or financial guaranty insurance to a

viatical settlement provider, purchaser, financing

entity, special purpose entity or related provider

trust,

e. a natural person who enters into or effectuates no

more than one agreement in a calendar year for the

transfer of life insurance policies for any value less

than the expected death benefit,

f. a financing entity,

g. a special purpose entity,

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h. a related provider trust,

i. a viatical settlement purchaser, or

j. any other person that the Commissioner determines is

not the type of person intended to be covered by the

definition of viatical settlement provider;

18. “Viatical settlement purchaser” means a person who provides

a sum of money as consideration for a life insurance policy or an

interest in the death benefits of a life insurance policy, or a

person who owns or acquires or is entitled to a beneficial interest

in a trust that owns a viatical settlement contract or is the

beneficiary of a life insurance policy that has been or will be the

subject of a viatical settlement contract, for the purpose of

deriving an economic benefit. Viatical settlement purchaser does

not include:

a. a licensee under the Viatical Settlements Act of 2008,

b. an accredited investor or qualified institutional

buyer as defined, respectively, in Rule 501(a) or Rule

144A promulgated under the Federal Securities Act of

1933, as amended,

c. a financing entity,

d. a special purpose entity, or

e. a related provider trust;

19. “Viaticated policy” means a life insurance policy or

certificate that has been acquired by a viatical settlement provider

pursuant to a viatical settlement contract; and

20. “Viator” means the owner of a life insurance policy or a

certificate holder under a group policy who resides in this state

and enters or seeks to enter into a viatical settlement contract.

For the purposes of the Viatical Settlements Act of 2008, a viator

shall not be limited to an owner of a life insurance policy or a

certificate holder under a group policy insuring the life of an

individual with a terminal or chronic illness or condition except

where specifically addressed. If there is more than one viator on a

single policy and the viators are residents of different states, the

transaction shall be governed by the law of the state in which the

viator having the largest percentage ownership resides or, if the
ificate holder under a group policy insuring the life of an

individual with a terminal or chronic illness or condition except

where specifically addressed. If there is more than one viator on a

single policy and the viators are residents of different states, the

transaction shall be governed by the law of the state in which the

viator having the largest percentage ownership resides or, if the

viators hold equal ownership, the state of residence of one viator

agreed upon in writing by all the viators. Viator does not include:

a. a licensee under the Viatical Settlements Act of 2008,

including a life insurance producer acting as a

viatical settlement broker pursuant to the Viatical

Settlements Act of 2008,

b. qualified institutional buyer as defined,

respectively, in Rule 144A promulgated under the

Federal Securities Act of 1933, as amended,

c. a financing entity,

d. a special purpose entity, or

Oklahoma Statutes - Title 36. Insurance Page 873

e. a related provider trust.