Maintenance of Keep Policies
Pursuant to the Courts
- Collection
of Administration Fees
-
Collection of
Investors’ pro-rata share of premiums
-
Payment of
premiums to insurance companies, as they become due
-
Policy conversions
-
Maintenance of
waiver of premium benefits, where applicable
-
Tracking of all
insureds
-
Processing and
collection of death benefit proceeds from insurance companies
-
Distribution of
death benefit proceeds to Investors
-
Customer service
General
The Receiver and the staff of
VSI recognize that the past three years has been a difficult time for
Investors. We therefore thank you for
your patience and look forward to servicing your needs, to the best of our
ability, in the future.
Administration Fees
During the initial billing
cycle, Investors were billed separate from their premium obligation, a $175
Annual Administration Fee and a Pro-Rata portion of $195 as an Annual Policy
Fee (collectively the “Annual Fee”).
This fee structure resulted in some Investors paying $370 and others as little
as $176, depending upon the number of Investors associated with a particular
policy.
The Receiver has advised the
Court in the “Twenty
Fourth Report of the Receiver”, that VSI
will be billing Investors their Annual
Fee as a flat fee of $240 in the next billing cycle. Additionally, Investors will be billed the Annual Fee as a line item on the Notice of Premium Due, thus eliminating
the need for a separate billing. This fee structure simplifies the billing
process for both VSI and Investors and provides for a more equitable
distribution of fees charged to Investors.
Click
here for a direct link to a Sample of the revised Notice of Premium Due
Premium Obligations
During the initial billing
cycle, Investors were first provided with a Notice
of Premium Due representing their pro-rata share of the policies’ premium,
due within 90 days (this time period was subsequently reduced by the Court to
45 days). Following the Notice of Premium Due, and assuming
insufficient premiums were collected, Investors were provided with a Notice of Premium Shortfall due within
45 days. This Notice gave Investors three options to attempt to fully fund the
policies’ premium obligation. Option “A”
represented an additional pro-rata share, calculated from investors who
forfeited their interest(s) by not remitting their Notice of Premium Due. Option “B” represented an opportunity for
Investors to remit, in addition to the Option “A”
amount, an amount up to the total forfeited amount on a first come basis. Option “C” represented no additional
remittance.
This process, as described
above, will continue in future billing cycles with the exception of the
inclusion of the Annual Fee for
administration fees on the Notice of
Premium Due. To expedite receipt of Notices by non
On September 14, 2007, the
Receiver filed a motion with the Court seeking relief on an emergency basis in
that there are certain policies, following the Notice of Premium Shortfall period, for which Investors have not
paid the required premium funds (“Undersubscribed Keep Policies”), resulting in
fractional interests of death benefits which must be disposed of in order to
avoid the Receiver having to use Receivership funds for premiums which may not
be recoverable. In addition to analyzing a reduction in the face amount of the
policy, which may be limited in many circumstances, the Receiver plans to
expand the disposition of Undersubscribed Keep Policies. Specifically, the sale of fractional
interests in Undersubscribed Keep Policies, or groups of such interest, for
which the premium obligation has not been funded, to third parties, again
through an abbreviated auction process. The Receiver would communicate the
availability of such interests to existing parties who have expressed an
interest in the acquisition of said interests.
Potential buyers would be required to execute a confidentiality
agreement, an affidavit of non-affiliation with any of the Receivership entities,
and provide evidence of financial ability.
Potential buyers would receive the same information with respect to a
policy that had been provided to the original Investors in the policy. On
Click here for a direct link to the Policy Billing Page set up by the Receiver to provide access to
a listing of policies, categorized by policy number and date of mailing, for
which Notices have been mailed to Investors. This listing will be updated on a
weekly basis. If an Investor does not receive their Notice within a reasonable
period of time from the date of mailing, they should contact VSI/