Business and Professional Ethics Journal

Volume 31, Issue 3/4, Fall 2012

What Is So Morbid about Viaticals? An Examination of the Ethics of Economic Ideas and Economic Reality

A viatical settlement (or viatical) is a transaction in which an investor purchases the life insurance policy from a terminally ill person for a lump sum so that the investor can receive those benefits at the time of death. While there is an ongoing debate in the insurance and financial planning industry about viaticals, including the ethics of this practice, the focus has been predominantly on abuses in the course of buying and selling viaticals and less on the fundamental ethicality of the economic idea behind viaticals. This paper offers a systematic ethical analysis of viaticals that leverages the distinction between the ethicality of an economic idea and the ethicality of economic reality to isolate and discuss the fundamental ethical problems of viaticals. By unpacking the evaluative content of our negative emotional reactions to viaticals, we show that, even under ideal circumstances, the economic idea of viaticals is, at its core, unethical.