Close Close
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards

Life Health > Life Insurance

Ask the expert: Any type of life policy?

Your article was successfully shared with the contacts you provided.

The question was: Is any type of life insurance policy open for possible settlement, whether it is universal, variable, indexed, whole, term, group, voluntary, employer-owned, premium-financed, small-faced, large-faced, etc.?

The answer is: “Theoretically, the economics of any contract can be reduced to a monetary value, including insurance contracts.

“But the reality is that the terms of some contracts can be excessively complex or insufficiently manageable, resulting in a structure that is not conducive to efficient investment.

“Investment in life settlements requires a contract that can be controlled by the investor within its risk tolerances. Some investors want to keep it simple, while some may accept complexities in exchange for higher returns.

“Life insurance is issued in many different forms and even more different contracts, with many different terms. Each offers different economics and choices for life settlement investors….

“The secondary market has become sufficiently mature and efficient to offer many variations on (life settlement) considerations …and sellers with unique insurance contracts may find investors willing to consider their policies.”

Source: This is an excerpt from Life Settlement Planning, a 2008 book in the Tools & Techniques serried published by The National Underwriter Company, Cincinnati, Ohio, which also publishes Settlement Watch. The excerpt appears on pages 194-195 of Chapter 10. The book is co-authored by: Stephan R. Leimberg, Caleb J. Callahan, Bryan T. Casey, James Magner, Barry Reed, Lawrence J. Rybka, Paul A. Siegert. Read more about Life Settlement Planning here.


© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.