Posted by The Policy Settlement Alliance on Thu, Aug 19, 2010 @ 01:36 PM
By Michael J. Collins
The life settlement industry is a relatively young and upcoming industry in the financial markets. Its primary goal is to provide those seeking to unburden themselves from unwanted life insurance policies with options; that are more profitable then surrendering the insurance policy for the cash value. Despite the options that the settlement industry provides it has experienced some tumultuous times.
The events in the life settlement industry have shaped the market into a more respectable, and client first orientated financial industry. Through organizations like LISA, which ensure standards across the industry, the life industry has become a reputable and respected option for many clients. LISA has also aided clients in understanding how to find the most appropriate broker for them.
As the industry has grown, there have been several other options that have opened up. Especially when dealing with the terminal ill, these other areas are called viaticals, which have been discussed in great detail in previous blogs. In closing the life settlement industry has grown from a fledgling area of business to a full respected and needed financial field that has been able to provide yet another area of revenue for those who need it.
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Note: Blog posts reflect the opinion of the author, which may differ from the opinion of policysettlement.com.
Posted by The Policy Settlement Alliance on Mon, Aug 16, 2010 @ 10:03 AM
By Blaine M. Ferguson
The life settlement industry has faced numerous challenges over the last several years, but is now emerging from the recent credit crisis more healthy and poised for significant growth over the next decade.
At the recent annual shareholder meeting for Life Partners Holdings, Chairman and CEO David Prado discussed his thoughts on the future of the company and the industry as a whole. The overall outlook for the company is strong in the years to come and the life settlement industry will also continue to grow after the recent downturn.
The company directors also mentioned that LPI was well positioned to handle any potential legislative changes that have been recently discussed by the SEC and members of Congress.
The life settlement industry does face some difficulties such as a double dip recession or credit tightening. Regulatory and legislative changes could also effect the settlement industry. The most factor that will keep the settlement industry viable is that life settlements help to provide a much needed service to policy owners and investors.
For more information regarding the settlement industry, please click on the LIVEpdq link in the upper right of the page.
Note: Blog posts reflect the opinion of the author, which may differ from the opinion of policysettlement.com.
Posted by The Policy Settlement Alliance on Tue, Aug 10, 2010 @ 01:51 PM
By Phillip J Powell
The life settlement industry is a rapidly growing industry. During the 90's the settlement industry became popular do to the AIDS epidemic. Many policy holders sold their insurable interest to an individual or a company for the living benefit of the insurance policy. Many of these policy holders were taken advantage of and offered pennies on the dollar for the their policies . The settlement industry has gotten better at taking care of the interest of the insured by putting maximums on commissions and minimums on what the policy holders will receive from a settlement.
The life settlement industry is not widely excepted by the insurance industry because it takes insurance policies that would potentially lapse and takes them all the way to the death of the insured forcing these large companies to pay out. Many states require companies to offer a life settlement as an alternative to a policy holder to letting the policy lapse. Life settlement companies in many cases turn a problem into an equity for their clients. People sometimes run out of options in these trying times and selling their life insurance policy is like an act of god.
The life settlement industry is an ever changing industry do to the overall performance of the secondary market and the overall state of our economy. For more information please go to LIVEpdq.
Note: Blog posts reflect the opinion of the author, which may differ from the opinion of policysettlement.com.
Posted by The Policy Settlement Alliance on Fri, Aug 06, 2010 @ 01:10 PM
By David M Epstein
The life settlement industry relies heavily on life expectancy companies and the information they provide. Life settlement industry providers and investors use LE reports as a key tool in deciding whether or not to purchase a policy as an investment. Most providers require two LE reports for review. Unfortunately some seniors who should have no problem selling their life insurance policy do not get offers due to inconsistent reporting on behalf of the LE provider.
Fortunately LISA (Life Insurance Settlement Association), the leading life settlement industry advocate, is attempting this year to bring the top life expectancy companies together to adopt best practices guidelines which the LE industry is lacking. LISA hopes to have a standard table that LE companies will use in order to determine life expectancy estimates. In addition LISA would like to see these tables be available to the providers and investors purchasing the policies to help them be better informed on the investments they are making.
Click the LIVEpdq link for a free life settlement estimate and access to more information about the industry.
Note: Blog posts reflect the opinion of the author, which may differ from the opinion of policysettlement.com.
Posted by The Policy Settlement Alliance on Thu, Aug 05, 2010 @ 11:17 PM
By Ian F Smith
I was reading through some life settlement industry journals and articles and came across a few reports that I thought were interesting. One came from Bloomberg and cited a report from a Washington based consultant. It stated the following:
- In the year 2008, the average death benefit face value of a settled policy was $2,300,000.
- The average annual premium for a $2,000,000 policy was $98,440 and the policyholder in 2009 would have received about $263,818 for selling it rather than receiving the $36,700 of cash surrender value for surrendering the policy to the insurance company.
- The life settlement industry reported that they purchased policies in 2009 with a total face value of $7.01 Billion compared to $12.95 Billion purchased in 2008.. They cited the credit crunch for the decrease in demand.
Looking at these numbers it kind of told me the truth as to what I had been witnessing over the past year and a half. However, I was shocked to see that the life settlement industry went down by 54%. I knew the funding sources were drying up but I had no idea that the market would actually be cut in half. In addition, due to the decreased number of funding sources, those that did stick around began to really focus on the low hanging fruit. They only made offers on those policies that lined up perfectly with their rating systems. They didn't stretch their limits and take gambles.
One thing I do know that affected these numbers was the fact that funding companies were no longer interested in larger face amount policies. The $30M, $20M and even the $10M policies no longer had a market. The funding companies really started to focus on the purchase of $1M and $2M policies. So the big drop in total face value purchased can be blamed somewhat on the lower faced policies being purchased. The volume of sold policies did not go down by 54%. It was only affected by about 24%
So as the life settlement industry rebounds, you'll start to see these larger policies reentering the market once again. Keep that in mind when watching the market recover. You may see some huge percentage upswings in the life settlement industry. Don't get too excited. A lot of it will be the inventory of larger policies revisiting the market. Make sure to read between the numbers.
Stay tuned to our team by visiting our LIVEpdq webcast.
Note: Blog posts reflect the opinion of the author, which may differ from the opinion of policysettlement.com.
Posted by The Policy Settlement Alliance on Tue, Aug 03, 2010 @ 03:14 PM
By Jeff Kennedy
The life settlement industry has certainly seen its growing pains. In its original stages, too many companies with little experience were entering the market looking for easy money. There was little regulation and stranger oriented policies were a problem. The highly depended upon life expectancy industry had problems of its own. All of these created a perfect storm causing the near bust of the life settlement industry. However luckily the industry and the public have weathered the storm and learn from industry growing pains.
Associations supporting the industry have assisted regulators in passing legislation that legitimizes the life settlement industry. These regulations have cracked down on stranger oriented policies, made commission disclosure popular, and have forced life insurance companies to advise their clients that life settlements are a viable option. Associations such as LISA are also working with life expectancy companies to better their industry preventing another fall out damaging the settlement industry.
Click the LIVEpdq link for a free life settlement evaluation today!
Note: Blog posts reflect the opinion of the author, which may differ from the opinion of policysettlement.com.
Posted by The Policy Settlement Alliance on Fri, Jul 30, 2010 @ 04:01 PM
By Scott J. Dressel
In the last twenty four months the landscape of the life settlement industry has shifted dramatically. As with the entire economy capital issues became noticeable among the funders (third parties who purchase life policies from sellers). Another concern in the life settlement industry which has had an effect over the same time period is the change in life expectancy (LE’s) assumptions which have moved towards a conservative posture meaning people are going to live longer than life expectancy assumptions used in prior years. The end result was little capital to purchase polices and greater exposure to the investor in terms of ongoing premium commitments. For the consumer the result has been reduced cash payment offers for people wishing to sell their unneeded life insurance to no offers. However, if a consumer can no longer afford their insurance any offer above the cash surrender value offered by the issuing carrier should be considered a reasonable alternative. In the case of term insurance which has no internal cash value any offer would be considered better than simply allowing the policy to default. The life settlement industry like all industries is cyclical. If you own life insurance which you no longer have a need for visit our LIVEpdq link for a free policy review.
Note: Blog posts reflect the opinion of the author, which may differ from the opinion of policysettlement.com.
Posted by The Policy Settlement Alliance on Fri, Jul 30, 2010 @ 03:12 PM
By Edward E Leisher
The life settlement industry is growing and changing every day as individuals from the baby boomer generation approach and reach the required life settlement age. As these individuals may reach the point where they are considering selling their life insurance policy in a life settlement transaction, it is important to ask: what eligibility requirements does the life settlement industry have?
First, the model candidate for a life settlement will be at least 65 years old, but ideally in the 70 plus range with a life expectancy around 180 months. The policy to be sold must be more than two years old and the insured will have a change in health since that policy was issued. The types of policies that can be sold are Universal, Term, Variable and Survivorship Life and the face amount should be more than $100,000.
In addition to consulting with experts in the life settlement industry, always consult with your financial advisors regarding tax implications before entering into a life settlement transaction. Please visit LIVEpdq for more information.
Note: Blog posts reflect the opinion of the author, which may differ from the opinion of policysettlement.com.
Posted by The Policy Settlement Alliance on Thu, Jul 29, 2010 @ 10:06 AM
By Joseph W. Horner
The life settlement industry is fueled by investors that perceive the purchase of insurance policies as a lucrative investment and the willingness of policy owners with the need to sell their insurance policy. Often times investors have significant holdings which they wish to deploy but most often do not deploy 100% of it into the life settlement industry but rather a smaller percentage which will often be depicted as an alternative market different from the investor’s core investment strategy.
While it seems there is always a need for people to sell unwanted or un-needed life insurance policies the investors are not always as prolific. Many investors have pulled away from the life settlement industry with the downturn in our economy and are either placing their money into secure investments with lower returns or simply do not place monies into an alternative market life the settlement industry and hold onto cash.
As the settlement industry continues to mature the returns will become more predictable and the introduction of appropriate regulation will assuage concerns over investors currently concerned over some of the lack thereof. With this maturity the selling of an insurance policy should become more acceptable and commonplace for all parties concerned. We are not there yet but it shouldn’t be that much longer.
For more information about life settlements please visit LIVEpdq.
Note: Blog posts reflect the opinion of the author, which may differ from the opinion of policysettlement.com.
Posted by The Policy Settlement Alliance on Wed, Jul 28, 2010 @ 09:46 AM
By Rick S Cantville
The financial services industry certainly took it's share of hard knocks in late 2008, but it seemed the life settlement industry received a double serving. In addition to many of the money sources drying up, the industry was also jolted from changes in life expectancy calculations. These changes affected the industry as a whole, and at times, some speculated whether the industry would survive.
One of the calculations used in determining the value of a life insurance policy is a life expectancy. This is an estimation of how long, statistically speaking, a person will live and is based on years of mortality tables and the history of thousands of lives. The shake-up came when several of the life expectancy evaluation companies changed the life expectancies, often increasing expected mortality by as much as 30%. Investors, unsure of the real affect of this change, sought safer harbors in which to invest their money.
This damaged the life settlement industry, but it left cash-strapped seniors with little or no alternative when it came to the ability to sell an unwanted life insurance policy. If a policy was no longer affordable, it was often lapsed or surrendered instead of receiving fair market value for the policy. As a result, many seniors went without the added benefit of receiving the lump sums of cash to add to their retirement funds.
Today, many industry insiders are confident that money sources are returning to the life settlement industry and is poised for new growth. This will allow seniors looking to supplement their retirement to sell their policy and extend their retirement dollars further.
Determine what your policy is worth today by visiting LIVEpdq!
Note: Blog posts reflect the opinion of the author, which may differ from the opinion of policysettlement.com.