3.__Chronically ill.__"Chronically ill" means:

A.__Being unable to perform at least 2 activities of daily living, including, but not limited to, eating, moving from one place to another, bathing, dressing, voiding the bladder, eliminating the bowel or maintaining continence;

B.__Requiring substantial supervision to protect the individual from threats to health and safety due to severe cognitive impairment; or

C.__Having a level of disability similar to that described in paragraph A, as determined by the United States Secretary of Health and Human Services.

4.__Financing entity.__"Financing entity" means an underwriter, placement agent, lender, purchaser of securities, purchaser of a policy or certificate from a settlement provider, credit enhancer or any entity that has a direct ownership in a policy or certificate that is the subject of a settlement contract:

A.__Whose principal activity related to the transaction is providing funds to effect the settlement or purchase of one or more purchased policies or to provide credit enhancement; and

B.__Who has an agreement in writing with one or more licensed settlement providers to finance the acquisition of settlement contracts or to provide stop loss insurance.

"Financing entity" does not include a nonaccredited investor.

5. Financing transaction.__"Financing transaction" means any transaction in which a licensed settlement provider obtains financing for the purchase, acquisition, transfer or other assignment of one or more settlement contracts or policies acquired pursuant to a settlement contract or interests therein, including, without limitation, any secured or unsecured financing, securitization transaction or securities offering, either registered or exempt from registration under federal and state securities law, or otherwise sells, assigns, transfers, pledges, hypothecates or otherwise disposes of a settlement contract or policy acquired pursuant to a settlement contract or interest therein.