State RegulationsOH specificDifficulty 3/5
A viator receives the settlement proceeds under a viatical settlement contract, and the insured dies before the rescission period expires. Under ORC 3916.08, what is the result?
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
ORC 3916.08 provides that if the insured dies during the rescission period, the viatical settlement contract is deemed rescinded: ownership of the policy reverts to the viator or the viator's estate, subject to repayment of the proceeds, so the death benefit flows under the restored ownership rather than to the provider.
Why the other options are wrong
- A) Payment of proceeds does not end the matter; ORC 3916.08 deems the contract rescinded when the insured dies during the rescission period.
- C) The insured's death during the rescission window triggers rescission under ORC 3916.08; it does not cut the period short and confirm the sale.
- D) The issuing insurer simply pays the death benefit to the rightful owner after rescission; ORC 3916.08 does not create a split payment.
Memory hook
Death inside the 15-day window unwinds the deal: money back, policy back to the viator's estate.