‘Death Bet’ Cases Seeking to Claw Back Payouts Hit With Setback

Delaware’s top court dealt a blow Wednesday to a wave of cases seeking to claw back the winnings of “death bets” placed by third-party investors on the lives of strangers.

In a novel ruling, the state supreme court imposed a three-year time limit on lawsuits by family members seeking to recoup payouts to investors that purchased “stranger-originated life insurance policies” on the secondary market—legally—years after they were taken out by middlemen who paid senior citizens up front to sign them over. The downstream investors facing similar litigation include Apollo Global Management Inc., which has denied wrongdoing in a separate ...