ALBANY — New York’s top court ruled yesterday that state law doesn’t prohibit people from buying life-insurance policies and immediately selling them to investors who make money when the insured person dies.

The Court of Appeals, in a 5-2 ruling, said the practice is legal in New York even where the policy was obtained solely for that purpose.

The case involved transactions before the law was amended by the Legislature last year to regulate so-called “stranger originated life insurance,” or STOLIs. Those changes took effect in May.

The question was whether someone can buy a policy with no intention of protecting their usual beneficiaries, loved ones with a personal or economic stake in their welfare. Instead, the unrelated investor pays the premiums and collects the benefits.