State RegulationsNC specificDifficulty 2/5
Under North Carolina law, what must a viatical settlement application or purchase agreement contain?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Under G.S. 58-58-267, viatical settlement applications and purchase agreements must carry the statutory fraud warning, which tells the applicant that knowingly presenting false information in connection with the transaction is a felony. The warning exists because viatical transactions create strong incentives to misstate health information, and the statute makes the criminal consequence explicit on the face of the paperwork.
Why the other options are wrong
- B) The Buyer's Guide and Policy Summary regime governs the solicitation of life insurance, not viatical settlement paperwork.
- C) The 30-day unconditional refund right belongs to life insurance replacement transactions, not viatical settlements.
- D) The Notice Regarding Replacement applies when one life policy replaces another, which is not inherent in a viatical settlement.
Memory hook
Viatical papers scream felony up front: lie and you lose your freedom.