State RegulationsNY specificDifficulty 3/5
Three siblings — one a New York resident, the others residents of two neighboring states — own a single life policy in equal shares and propose a life settlement. Under N.Y. Ins. Law §7819, which state's residency governs?
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
Under N.Y. Ins. Law §7819, when a single policy has multiple owners who are residents of different states, the state of residency is the state in which the owner having the largest percentage of ownership resides — and where the owners hold equal ownership, the state of residence of one owner, agreed upon in writing by all of the owners. Because these siblings hold equal shares, their written agreement picks the governing residence; no outside authority designates it for them.
Why the other options are wrong
- A) The mere presence of one New York owner does not control; for equal co-owners the choice is made in writing by all owners together.
- C) The multi-owner rule looks to the owners' residences and ownership percentages, not to where the insured lives.
- D) The Superintendent does not designate the governing state for multi-owner settlements; §7819 assigns that choice to the owners themselves.
Memory hook
Equal co-owners, different states: all owners agree on one owner's home state — in writing.