by John Darer® CLU ChFC MSSC RSP CLTC
Section 7718 of the New York Insurance Law prohibits the use of the Life Insurance Guaranty Corporation of New York for the purpose of selling life or accident and health insurance or annuities or soliciting or inducing the purchase of such insurance.
Plaintiffs and Plaintiffs attorneys should be on guard for attempts to place a plaintiff into a structured settlement, with a lower AM Best or Standard & Poors rating, with the purported justification being that any default would be covered by the Life Insurance Guaranty Corporation of New York.
Whether it is or is not is immaterial. Would you put money in a bank with weaker financials just because it is "FDIC insured"? Any broker who utilizes the Life Insurance Guaranty Corporation of New York in a manner described in Section 7718 is violating the law.
Leave a Reply