A national state legislators group due to vote on model legislation for the life insurance industry includes several members who have taken campaign money from parties who could be affected by the measure.

The National Conference of Insurance Legislators, Troy, N.Y., is in the final stages of developing its Life Settlements Model Act. The group is scheduled to hold an all-day meeting on Oct. 25 in Chicago and another full-day meeting on Nov. 14 just prior to its annual meeting in Las Vegas.

Legislators developing the model hope it can be voted through NCOIL at the annual meeting, according to George Keiser, chair of the NCOIL Life Settlements subcommittee.

Life settlements are the sale of life insurance policies to a third party. The issue has taken on considerable import because of recent variations on the initial concept of life settlements that involve the purchase of life policies with the intent to at some point in the near future settle them.

But filings listed on state Web sites indicate that several members of the subcommittee have accepted campaign contributions from stakeholders in the model's development.

Records show that four members of the 11-member subcommittee developing the life settlement model law have accepted campaign contributions from parties that could be affected by the model.

The state legislators are: Kentucky Rep. Robert Damron, D-Jessamine; Pennsylvania Rep. Robert Godshall, R-Montgomery; Georgia Sen. Ralph Hudgens, R-Hull; and New York Sen. James Seward, R- Oneonta.

State election Web sites indicate the following campaign contributions:

o Rep. Damron--received two campaign contributions from Alan Buerger, CEO of the life settlement company Coventry First, Fort Washington, Pa. The first contribution was made on Nov. 14, 2005 for $1,000, with a second donation of $1,000 following on Aug. 14, 2006. A $1,000 donation was also made by Constance Buerger, CFO of Coventry First, on Nov. 14, 2005.

o Rep. Godshall--A $1,500 donation was made by Alan and Constance Buerger on April 17, 2007. On the same date, a $1,000 contribution was made by Michael Freedman, listed as senior vice president of Coventry First.

o Sen. Hudgens--A $1,000 campaign contribution was made by Coventry First on Oct. 11, 2005. On Dec. 2, 2005, a $500 campaign contribution was made by Prudential Financial, Newark, N.J.; and on Dec. 5, 2005, the American Council of Life Insurers, Washington, made a $500 campaign contribution.

o Sen. Seward--2006 donations from the Life Insurance Council of New York, totaling $6,697.44; 2005 LICONY contributions totaling $6,000; and a $2,000 Oct. 20, 2006 contribution from Habersham Funding LLC, Atlanta.

Susan Nolan, NCOIL executive director, said NCOIL has no recusal policy for legislators to remove themselves from votes, nor does it have a conflict of interest policy because each state legislator is bound by that legislator's state campaign and ethics laws. She said that she could not predict whether NCOIL would develop a conflict of interest policy at some point in the future.

North Dakota State Rep. George Keiser, R-Bismarck, is not listed on his state's Web site as taking contributions from stakeholders but did comment on the issue. During an election cycle, he said, it is usual for a legislator to receive legal contributions from entities that are involved in work on committees that he works on. But, he continued, it would never affect a vote.

Mr. Keiser and several other legislators distinguished between regular election cycle contributions and excessively large contributions in off-election cycle years.

Mr. Keiser said he believes in the integrity of the other legislators on his subcommittee and does not think it would impact the model's development.

Rep. Damron said all donations followed Kentucky law and that in the last election cycle he had raised approximately $150,000. He noted that he has taken contributions from a variety of parties in the industry and that it would "not at all" affect his vote.

He explained that he believes consumers should have the right to settle their contracts and that if a contract is surrendered or lapses, the true value is not realized. The NCOIL model is a "pretty good model," he asserted.

Sen. Hudgens said that he has taken legal contributions from stakeholders including a recent $1,000 contribution from the National Association of Independent Life Brokerage Agencies, Fairfax, Va., in June. He said that he raised approximately $125,000 to 130,000 in the last election cycle.

He also confirmed that he had accepted a flight on Coventry's private jet in order to reach an NCOIL meeting last year on life settlements at Crystal City, Va.

Mr. Hudgens said the Georgia Senate session had met until after midnight and when asked if he would be able to attend the NCOIL meeting, he had responded that it would be impossible. He said Coventry had maintained that it was important for legislators to be at the session which started in the morning and had offered him transportation. Without such transportation, he said, it would have been impossible for him to participate.

Rep. Godshall and Sen. Seward could not be reached immediately for comment.

Special Reports /

Life Groups Give $$ To NCOIL Legislators

Related Stories

Recommended For You