Life Settlement Broker Required to Be Licensed in Arizona

In Arizona, life settlement brokers are required to be licensed to operate in the state. This is due to the state's regulatory framework, which aims to protect consumers from unscrupulous practices.

To become licensed, a life settlement broker must meet certain requirements, including having a minimum of two years of experience in the life insurance industry. This experience can be in sales, underwriting, or another related field.

A life settlement broker must also pass a licensing exam, which tests their knowledge of Arizona's life settlement laws and regulations. This exam is administered by the Arizona Department of Insurance.

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To become a life settlement broker in Arizona, you'll need to meet the state's requirements. An Arizona-licensed insurance professional must meet additional requirements for certain types of licenses.

Arizona law includes viatical and life settlements in the statutory definition of security. A.R.S. § 44-1801(26) states that viatical settlements are investment contracts. See Siporin v. Carrington, 200 Ariz. 97 (Ct. App. 2001).

To offer or sell life settlement investment contracts in or from Arizona, you must register as a dealer or salesman. This is an important requirement to keep in mind.

Here are the key requirements to become a life settlement broker in Arizona:

Viatical settlements involve an interest in someone's insurance policy, where the purchaser receives a portion of the insurance benefits when the insured individual dies. The amount of return on the investor's money depends on how long it takes for the insured individual to die.

Providers assess life expectancy with an eye on medical documentation to estimate the timeline, and evaluate the type and terms of the policy, including any existing cash value, alongside ongoing premium obligations.

The valuation of a life insurance policy in a viatical settlement varies, influenced by several factors beyond just the face value of the policy, including economic conditions and the competitive landscape of viatical settlements.

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Viatical and life settlements are securities, and Arizona law provides an exemption from registration for viatical or life settlement investment contracts.

Strict licensing for brokers and providers, mandatory disclosure of all transaction details, and privacy measures are in place to protect policyholders and prevent fraud throughout the process.

The Securities Division recommends that you consult with a securities attorney for additional information, and registration as a dealer or salesman is required if you offer or sell these types of investments in or from Arizona.

To become a life settlement broker in Arizona, you'll need to navigate the state's licensing process. You can start by completing an Arizona Insurance Pre-license Course, which costs around $149.

The course will prepare you for the Arizona Life Insurance Licensing Exam, which is administered by Prometric and costs $38. You'll have 120 minutes to complete the exam, which consists of 100 scored questions covering seven sections.

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To take the exam, you'll need to pay the fee at the time of reservation using a credit card, debit card, or voucher. Prometric will then notify the Arizona DIFI of your exam results within 48 hours.

Here's a step-by-step overview of the Arizona licensing process:

After passing the exam, you'll need to submit your completed license application within 12 months. You'll need to provide a completed Form L-FPV and pay a total application fee of $125.60. Once your application is processed, you can print your license from the NIPR website or use the NAIC State Based Systems (SBS) Arizona Lookup tool to manage and search for your license.

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In Arizona, securities and insurance go hand-in-hand, especially when it comes to life settlement brokers. Generally, a limited partner has no right to manage or control the partnership business, making limited partnership interests securities.

Securities can be tricky, especially when the business of the limited partnership is investing in securities, like hedge funds. The general partner of a limited partnership that invests in securities may need to license under the Investment Management Act of Arizona.

Variable annuities are also securities, and anyone offering or selling them in Arizona must be registered as a dealer or salesman. A person can check the Securities Act of Arizona, Investment Management Act, and Investment Management Rules for more information.

To get an Arizona life insurance license, one must complete an Arizona Insurance Pre-license Course, take the Arizona Life Insurance Licensing Exam, and get a Fingerprint-Based Background Check. The process involves several steps, including submitting an application and mailing a fingerprint card and form.

Here is a step-by-step guide to getting an Arizona life insurance license:

To keep your Arizona life insurance license valid, you'll need to complete 48 hours of continuing education (CE) every four years. This is a requirement to renew your license and maintain its good standing.

The CE hours must include at least six hours of ethics training. You can find Arizona-approved courses and providers on the Prometric Arizona Licensees page.

If you have a non-resident license and are in good standing in your home state, you don't need to take CE courses in Arizona.

To avoid delays in renewing your license, complete your CE hours within 90 days before your license expires.

The renewal fee is $120, with a late fee of $100 if you miss the deadline.

You can email the Arizona Department of Insurance and Financial Institutions at [email protected] for more information.