Emergent Capital Inc. and Sun Life Assurance Co. of Canada have settled a longstanding lawsuit.
Under the settlement, 30 life insurance policies issued by Sun Life and held by Emergent Capital and certain subsidiaries, primarily by White Eagle Asset Portfolio LP, were canceled in exchange for a lump sum payment from Sun Life of $36.1 million.
Sun Life also agreed not to challenge the validity of or to seek to deny coverage, other than for nonpayment of premiums, for certain life insurance policies issued by it and held by White Eagle that were specifically excluded from the settlement or have already matured. The parties have released all claims against each other.
To implement the settlement, a portion of the proceeds was used to repurchase the policies from White Eagle.
Sun Life Assurance had sued Imperial Holdings Inc. and others in 2013, accusing Imperial of devising "a scheme to manufacture and then acquire life insurance policies." Sun Life Assurance also claimed that the scheme disregarded its ban on using life insurance as a wagering contract and that Imperial committed fraud in the application process.
Sun Life did not immediately respond to a request for comment from S&P Global Market Intelligence.