BUSINESS WIRE - 44 Montgomery St, 39th Floor, San Francisco, CA 94104; Tel: (415) 986-4422; FAX: (415) 788-5335 - Tuesday, 26 November 1996.
The advent of miracle drugs called protease inhibitors has lengthened life expectancies for people living with HIV and AIDS. In turn, the viatical settlement industry has reemerged to provide a financial alternative for any person living with medically determined cancer, heart disease, immune deficiency or other terminal illness.
Spurring industry growth will be an added enticement for the person living with a terminal illness -- as of Jan. 1, 1997, a long-awaited tax break from Uncle Sam. However, in order to receive this tax-free benefit, one must own a life insurance policy or participate in a group life insurance plan and be willing to sell the policy for immediate cash.
When a policy is sold, a person generally receives from 40 percent to 80 percent of the existing policy's total benefit income tax-free.
"Using this significant financial resource, many have chosen to: fulfill lifelong dreams, take charge of medical care, reduce outstanding debt, avoid bankruptcy or simply enjoy helping others.
"The income-tax-free status has given a fresh perspective to this evolving industry," said Nancy Cane, executive director of benefit advocates -- a California licensed viatical advisory service responsible for assisting more than 800 people in the last four years to receive more than $50 million worth of viatical settlements, in an industry with an expected volume of $500 million in 1996.
Cane, also the vice president of the Viatical Association of America, advised, "To receive the income-tax-free status, the viatical company must be licensed in the state of residence of the seller of the policy, and the attending physician needs to attest to a probable two-year life expectancy."
Benefit Advocates can be reached at 800/435-8891. In addition, each state Department of Insurance provides a current list of viatical companies. The industry also has two professional associations that offer a list of their members: the Viatical Association of America and the National Viatical Association, both located in Washington, D.C.
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CONTACT: Benefit Advocates, San Luis Obispo, Calif. Nancy Cane/Heather Vesterfelt, 805/541-8899 http://www.benefitadvocates.com
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Copyright © 1996 - Business Wire. All rights reserved. Reproduced with permission. Reproduction of this article (other than one copy for personal reference) must be cleared through the Business Wire, Permissions Desk, Business Wire, 1185 Avenue of the Americas, 3rd Floor, New York, NY 10036; Tel: (212) 575-8822; FAX: (212) 575-1854. http://www.businesswire.com.
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