My first experience coming across viaticals.... This makes me sick.....

[aphex]

Researching some stuff for work, my first time coming across this.....

A viatical is an investment in which investors buy shares in the life insurance policies of terminally ill patients.

The investments are purchased, usually through a broker, from a "viatical provider" such as Mutual Benefits Corporation. The provider pays the insurance premiums for the patients.

The investments allow the patients, who are known as "viators," to receive a lump sum for their insurance policies before they die.

The price of the viatical is based on the life expectancy of the viator, which is determined by a physician.

Once the patient dies, the life insurance policy pays the viatical provider, which then distributes a percentage of the proceeds to the investors.

Gillis, for example, said he bought $10,000 in viatical investments on two AIDS patients in 1997. One patient died, but the other disappeared for a period of years.

The viator was apparently located in another state, but has since refused to cooperate with MBC representatives seeking information about his health, Gillis said.

"So no one knows whether he has AIDS or not because the doctor who said he has AIDS went to jail," Gillis said.

When the company sold him the investments, he was told the viators were expected to live only 6 months to a year, Gillis said.

Anyone else sickened by this stuff?

Source: http://www.sun-herald.com/NewsArchive2/020306/np8.htm?date=020306&story=np8.htm

 

[QED]

Originally posted by: aphex
Anyone else sickened by this stuff?

I'd like to say I am, but I'm not.

I don't see how this is any more sick than life insurance or anything else similar.

 

[aphex]

Originally posted by: MathMan

Originally posted by: aphex
Anyone else sickened by this stuff?

I'd like to say I am, but I'm not.

I don't see how this is any more sick than life insurance or anything else similar.

Well buying life insurance to protect for the welfare of your kindred seems a bit nicer than buying someone elses life insurance at a discount on the cusp of their impending death, so they can cash in to attempt to prolong their life and you can benefit from their death.

 

[kranky]

If you're talking about the concept of viaticals, it does have value. For a terminally ill person who has life insurance but doesn't need it to provide for others after death, it can be a good thing. It's not necessarily to get money for medical care.

 

[FoBoT]

i think it has a place

if someone already had the insurance in place before they were sick and they don't have any heirs, then it is a win-win so they can get something before they die

 

[aphex]

Originally posted by: FoBoT
i think it has a place

if someone already had the insurance in place before they were sick and they don't have any heirs, then it is a win-win so they can get something before they die

true, i guess i wasn't looking at it from that perspective... just seems overtly morbid.

I just keep picturing when you contact a reciever to buy a viatical, they act like a used car salesmen "weve got a great rate on an Aids patient who won't make it more than 6 months..."

 

[dirtboy]

This typically isn't buying insurance on people who will die, because no life ins co will insure someone for more money than they are getting knowing the person will die.

Viaticals are when someone who has a short time to live has a large life ins policy that they spent money on; has cash value less than the death benefit. That person goes to a viatical company and sells the policy for more than they could receive by surrendering the policy.

The viatical company then parts out the cost to investors to make a profit. The investors profit if the person dies early and they loose if the person lives for awhile, because the investors may have to make large premium payments to keep the policy afloat once the cash value has been spent to make the premium payments.

I don't see why it's sickening for someone to get more money out of a policy than they have in it now. Perhaps you can explain to me why that's so bad?