Earlier this month, the U.S. Court of Appeals for the Eighth Circuit handed down a groundbreaking decision in one of the cases on our 2015 watch list. Overruling a Minnesota District Court decision, the Court of Appeals held that when a person purchases insurance on his own life, the policy is valid regardless of an intent to later transfer the policy. The Eighth Circuit also held that any challenges to a policy based on insurable interest must be made within the state's two-year contestability period. Orrick represented the appellants in the successful appeal of a lower court decision. The reversal of the lower court ruling is a major win for life settlement policy investors, as it significantly limits insurers' ability to challenge the validity of life insurance policies sold on the secondary market. See our client alert for a more detailed discussion of the decision.
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