Viatical Settlements New Investments for Wall Street?

Lol. Yes, very true.
Im not an advocate of securitizing LI policies; but they would at least be more stable than the government mandated high risk mortgages that recently blew up!

Also leave insurance under the control of the states. No SEC, no Feds. The states do a better job and it is closer to the populace where the citizenry can "get in the face" of corrupt state and locals pols.
 
Lapse rations are not a concern to insurance carriers in regards to Life Settlements. It is an industry misconception. The actual lapse ratio for large policies ($2mm+) on elderly individuals (70+) is very small. Think about it.....your average 80 y/o policy holder paying $200k a year for there $5mm policy is not going to regularly lapse their policy. We are not talking about 20 y/o buying $9 a month 10y terms here. The concern is that Life Settlements lead to STOLI/IOLI which could violate insurable interest laws. If that happens then the government could remove the tax advantages of life insurance crippling the industry. This is what the carrier are concerned about.

STOLI has always been the main concern. Luckily for the life settlement industry, STOLI will soon be a thing of the past. There is only one group that still buys contestable paper and due to regulation changes, they will stop in June. By July it will be legally impossible to do a STOLI transaction in any state that matters.

Also everyone should remeber who the largest owners of Life Settlements are....Insurance Carriers! They buy the most paper in the market!

Look back at AIG, they paid off part of the bail-out money with a 1.1B (of death benefit) securitized portfolio of Life Settlements. So now the US governement also owns a life settlement portfolio!!
 
To anyone interested, I work for AIS, which represents Radiant Financial. We currently work with Life Settlement Investments.

Our current offering is open to Texas residents. Policies were written on people between 79-81 years old. Current LE is 4-5.5 years. Investor should expect 15% annual rate of return, laddered over 4-8 policies.

Commissions are higher with Radiant than anywhere else in the industry. Investment includes premiums paid through LE +1. Current reviewers on these policies have a 95% actual to expected ratio.

All investments are funded through a chartered trust company. Investor writes the check directly to them. Radiant never owns any of the policies, to ensure client safety.

$25,000 minimum non-qualified
$50,000 qualified, and Radiant pays the custodial fees as well.

Anyone interested can call 866-318-5898 ext. 210 for commission details and any other questions.

[email protected]

Jim:

What are your thoughts on this product not being treated as a security. AIS does not require a series anything to sell the product?

Also you should show alittle more transparency in your posts. AIS has only been around for about a year or less? How can you have a 95% actual to expected ratio when your LE+1 is in the 5-7 year range?

I will give you credit for this, you do offer the highest commission out there....as an FYI the SEC has a special division based out of Houston thats soul purpose is to shut down fractional, non-security regulated, life settlement products.
 
This has nothing to do with the rights of insurance carriers. This has everything to do with my clients and future clients. I don't want them to have to pay higher premiums. I want them to insure themselves with very strong insurance companies. I want my livelyhood to not be affected adversely, so I can service my clients to the best of my ability.

So then what would you propose agents do when faced with a situation where a client who is going to lapse a policy could get more $$ by selling it than by surrendering it? Tell them not to do it b/c it would be a bad deal for the insurance company and could lead to higher rates for other, future clients? If the insurance companies made mistakes by under-estimating the number of lapsed policies, their profits should suffer. When life expectancies increased beyond their expectations throughout the 20th century, did they refund premiums to the policyholders because they had excessive profits?
 
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