Life settlement companies that were unable to collect the death benefit on a policy because of wrongful claims by an insurance company may be eligible to file a lawsuit to recover these policy benefits. Many of these cases involve claims by insurers that the policies in question were so-called “stranger originated life insurance,” or STOLI policies.
STOLI policies originate from brokers who induce someone else to take out a life insurance policy on themself with the intention of later selling the policy. Although this allows the broker to increase the pool of available life insurance policies, STOLI policies are prohibited by law in some states.
When life settlement companies try to collect the benefit on a life insurance policy, insurance companies may claim that the policy was a STOLI policy in order to avoid paying the death benefit. In other cases, the insurer may claim that there was no insurable interest on the policy.
Life settlements providers who have had a claim for death benefits wrongfully denied may be eligible to file a lawsuit against the insurer. Securing the services of a law firm with experience in handling life settlements claims—including those involving “STOLI” policies—is the first step in filing a lawsuit and recovering these wrongfully denied benefits.
The lawyers at Heygood, Orr & Pearson have filed several lawsuits on behalf of life settlements companies who have had the death benefits from life insurance policies wrongfully denied to them by an insurance company. For more information about filing a life settlements lawsuit, contact our firm by calling toll-free at 1-877-446-9001, or by filling out the free case evaluation form located on this page.