The Institutional Life Markets Association trade group is lauding the U.S. Senate Special Committee on Aging for turning its attention to the emerging secondary market for life insurance, also known as life settlements. “This is a welcome opportunity for the public to learn about this little-known, but valuable option for selling unwanted, unneeded or unaffordable life insurance policies,” said Jack Kelly, ILMA’s director of government affairs. ILMA wants clear and equitable regulation to ensure consumers have options when selling life insurance policies.
Like other assets consumers own, life insurance can be sold in order to raise cash, which may prove necessary in today’s economic climate. As the life settlement industry grows in response to consumer demand, transparency and protections for the consumer become more important. In order for the consumer to be fully protected, he or she must be aware of all the options available when considering the sale of a policy.
In response to industry growth, ILMA created the Life Settlement Transaction Disclosure Statement, an accounting of funds relating to an insurance policy sale on the secondary market. The information provided in this statement outlines the policy’s face value, its estimated cash value, the gross price being paid for the policy, the broker’s compensation and the seller’s net proceeds, providing the consumer with essential details of a sale.