During Senator Bob Casey's keynote speech at the Life Insurance Settlement Association's (LISA) annual spring conference last week, he discussed a letter that had been delivered to Treasury Secretary Timothy Geithner by himself and Senator Pat Toomey. The memo addressed concerns they had over federal tax treatment for the sale and purchase of life insurance policies, according to LISA.
"We were honored to have Senator Casey speak to our members and extremely grateful for his interest in our issues," LISA executive director Darwin Bayston said. "We will continue to support Senator Casey and Senator Toomey in their efforts to bring clarity for all participants in life settlements - consumers, life settlement companies and investors."
Senator Casey's letter raised questions about whether or not the Internal Revenue Service created confusion in the marketplace when it issued a ruling relating to life settlements. The ruling was intended to serve as advice on how buyers and sellers of insurance life policies should treat the transaction, according to the National Underwriter.
Casey went on to add that the ruling imposes different standards on the sale of a life insurance policy to a third party. These sales typically allow a policyholder to receive four to five times the amount of the cash surrender value of the policy.