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When you buy life insurance, there may come a time near the end of the process where your broker or agent will talk to you about backdating the policy.

If this happens, don't panic—your broker didn't just turn into a con artist.

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(Jason Mark Anderman illustrates the logistics problem well in this comment to a backdating post on Ken Adams’s blog.) There’s nothing inherently illegal or unethical about backdating contracts, although backdating can certainly be both unethical and illegal, depending on the situation.

For those with an hour to kill thinking about the issues, Jeffrey Kwall and Stuart Duhl wrote an excellent article on backdating that was published in Business Lawyer in 2008.

Even if a transaction is given retroactive effect as between the parties, it’s unlikely that the same will be true when non-parties are involved.

It’s often difficult — maybe impossible — to conceive of all the non-parties who could be affected by a transaction, so it’s non unlikely that there will be unintended consequences that won’t be cured by backdating a contract.

In light of that fact, there is no evidence that the FDIC was authorized to unilaterally cure title defects months after closing.” Effectively backdating written agreements so that they’ll be enforceable retroactively can be surprisingly complicated.