After a life settlement contract is completed, the life settlement provider needs to contact the insured from time to time to determine the insured's health status. Under the privacy provisions of the New York Insurance Law, such contact is:
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Why D is correct
Under N.Y. Ins. Law §7810, disclosure is permitted when necessary to allow the life settlement provider or broker — or an authorized representative — to administer the insurance policy or to make contacts for the purpose of determining the insured's health status as authorized by N.Y. Ins. Law §7813(k). That section limits verification contacts by life expectancy: no more often than once every 3 months when life expectancy exceeds 1 year, and no more often than monthly when life expectancy is 1 year or less. Representatives with a financial interest in the contract are excluded from authorized-representative status, and providers and brokers must obtain their representatives' written agreement to adhere to the article's privacy provisions.
Why the other options are wrong
- A) The statute expressly contemplates post-contract administration of the policy and authorized health-status contacts.
- B) Physician authorization is not the statutory mechanism; the contact must simply remain within the frequency limits of the life settlement article.
- C) Health-status contact authority flows from the life settlement article's own limits, not from per-contact written consent by the purchaser.
Memory hook
Providers may check an insured's health status — but only within the article's contact limits.