State RegulationsNY specificDifficulty 1/5
Under the New York Insurance Law, which of the following best describes a life settlement provider?
Select an option to reveal the answer and the full 3-part explanation — free, no signup.
Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Under N.Y. Ins. Law §7802, the life settlement provider is the purchasing party — the person that enters into life settlement contracts with owners, pays the owner the settlement amount, and takes ownership of the policy. The person negotiating on the owner's behalf is the life settlement broker, a lender acquiring a security interest is a financing entity, and the insurer is the company that issued the underlying policy rather than a settlement purchaser.
Why the other options are wrong
- B) Negotiating on behalf of the owner is the life settlement broker's role, not the provider's.
- C) A lender acquiring an interest in a policy as security is a financing entity — it funds deals rather than contracting to purchase the policy.
- D) The insurer issues the policy being sold; issuing a replacement policy is ordinary insurance business, not a life settlement.
Memory hook
Provider = Purchaser: the party on the buy side of every life settlement contract.