- Why would a policy owner sell their policy?
- Premiums paid by the policy holder become unaffordable and the policy may lapse.
- Estate planning needs have changed.
- Funds may be needed for long term care.
- Beneficiaries may have changed due to death or divorce.
- Disposal of key main insurance or other business related insurance.
- Changes in needs for the coverage.
- What’s in it for me?
- Strong Returns
- Potential for early maturities.
- Viable alternative to traditional fixed instruments.
- Diversification
- Non-correlating asset to the stock or bond markets, thereby shielded by its fluctuations and losses.
- Separate and distinct asset class.
- Inexpensive
- Deeply discounted A-rated or better life insurance policies.
- Strong intrinsic value.
- Unique
- A Growing Market
- Life Settlements are considered to be a new asset class and is a thriving industry in many countries throughout the world.
- The market includes buyers such as hedge funds, private equity groups and banks in the U.S., Asia, and Europe.
- As indicated in the graph, the life settlement industry has shown a positive growth year after year for the last 10 years *Estimates project transactions to exceed $160 billion in the year 2030.
*1. Life Insurance Long View – Life Settlements Need Not Be Unsettling; Bernstein Research Call; Kamath, Suneet and Timothy Sledge, March 4,2005; page 8.