Life Settlement in India & Insurance Laws (amendment) Act, 2015


With the amended Insurance Act at place, the Legislature’s stance on a long persisting debate has been answered. Trading of Life Insurance Policies was allowed by the celebrated Bombay High Court judgement in 2008. However, the judgement is under appeal in the Supreme Court. Meanwhile, the Parliament has brought amendments in the Insurance Act. The amendments have passively disallowed trading of life insurance policies in India and by a strange step; it has given the power to deicide such public interest issue in the hands of private insurance companies, which are engulfed with vested interest. In the quarrel of increase in FDI in insurance sector, amendment of such nature has been neglected. Not only it has abruptly stopped the debate, rather it has made the ongoing litigation infectious and brought new dimension in the debate. Will the amendment survive the test of its constitutionality? This is the question which shall be answered in this paper.
A theoretical method of research was adopted during the preparation of this article. A comparative study was made between the international and Indian outlook towards the life settlement industry. The Insurance (Laws) Amendment Act was critically examined and it was concluded that the law is perverse in the eyes of law.