PAGE 16 Q-Notes T January 1996
JEFFREY GRANT KOENIG
ATTORNEY and COUNSELLOR-AT-LAW
SUITE 400
1130 EAST THIRD ST.
CHARLOTTE, NC 28204-2624
(704) 335-5471
Viatical hearing
Continued from page 1
be able to sell her policy whether she believes
the settlement offers are acceptable or not.
Tony Britt, a Charlottean living with AIDS
who sold his policy in mid-October, believes
that the viatical process works fine just the
way it is. He was able to secure a 68 percent
payout rate for his policy even though his
health prognosis was very good. In fact, his
health was so good that his insurance com
pany initially balked at the sale. “When [I]
decided to sell my policy, I applied to four
companies and three responded. Once word
was out that I wanted to sell, I got bombarded
with calls. Almost every day someone was
calling me about it. I went with the company
I did because their representative was the
best. He was always courteous, he answered
every question I asked him and he always
returned my phone calls.”
Arrangements between viaticals and indi
viduals shouldn’t be the government’s con
cern Britt says. “It’s your own business. You
should be able to sell for 25 percent if you
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want to. I believe that having control is one of
the most important aspects in the life of a
person with AIDS. Being independent keeps
you motivated and helps to maintain a sense
of pride.”
Tom Hamby, a supervisor in the Insurance
Department’s Life and Health division, says
that the state’s purpose isn’t to squelch settle
ment transactions, merely regulate them. “The
Department’s actions are not to hinder the
operations of viaticals; we think they provide
an important option. We are not interested in
curtailing activity — we just want to make
sure that consumers receive fair settlements.”
Players on all sides of this issue agree that
fair payouts are important — the divergence
stems from attempts to mandate such equity.
Individual Benefits, a three-year-old
viatical settlement company in Greensboro,
is among the nation’s top ten viaticals and is
the only one based in the state. Its president,
Ramon Vicente, says that free market compe
tition is the best way to ensure high returns for
viators. “Competition has been very good for
the viatical industry. Now that there are many
companies available to consumers, everyone
has to offer good payouts or customers will
just go somewhere else. You see an aggres
siveness on the part of companies now that
you didn’t see before.”
Besides, Vicente says, if the state man
dates rates based on life expectancy, some
companies will simply start re-interpreting
the medical data to arrive at their desired
results. “Life expectancy estimates are very
subjective. Companies will just start reading
the material to arrive at estimates that work
more in their favor.” It’s far better, he be
lieves, to let the market weed out the inferior
agencies. “Companies that don’t give fair
payouts will receive fewer and fewer custom
ers and eventually go out of business any
way,” he says.
Despite the differing opinions on man
dated return rates, Vicente says that the De
cember hearing went surprisingly well and
the Department of Insurance was “positive”
in its comments on viatical settlement agen
cies in general.
Hamby says that the proposed regulations
have been sent to the Office of Administrative
Hearings, where they will be reviewed before
taking effect. No projected date for the insti
tution of the rules was given.
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