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Life Settlements and Electronic Nonresident Producer Licensing
Compliance Officer, Tom Offutt, J.D., explains the process.
Read article.
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LISA: An Organization Positioned for Growth
Marlene Frith, Director of Marketing & National Accounts, reviews
LISA's accomplishments in 2006.
Read article.
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Case Summary Spotlight:
Retiring Executive Sells Key-Man Policy. This case generated 10
offers from our network of funders. Summary of the case:
Face Amount: $4,300,000
Premiums: $253,004
Surrender Value: $-0-
Life Settlement: $1,450,000
View case summary.
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Results From Our February Quick Poll
Review results of our two-question poll.
View results.
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| This newsletter is intended for professional advisors only. Proceeds from a life settlement may be taxable. Professional tax advice is recommended. |
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New Data Points Illustrate Value to Senior Consumers: $148 Million Beyond Cash Surrender Value
Measuring outcomes through data analyses is an integral function of
any successful organization. A recent analysis of our year-to-date
tracking data (Jan.-Aug. 2006) shows that settlement offers generated
by Advanced Settlements within the last eight months provided seniors
with more than $148 million beyond cash surrender value. Our average
offer during that period was nearly 4 times the cash surrender value,
and more than 25 percent of the policy face.
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Morningstar Weighs In On Life Settlements
Life settlements have reached the radar screen of Chicago-based
Morningstar, Inc., a leading provider of independent investment
research. In an article dated June 16, 2006 entitled "Our Take on
the Secondary Market for Life Insurance," stock analyst Dafina
Dunmore delivers a fresh perspective centered around the premise that
"Consumers get more choice, and we don't think insurers will take a
big hit." The article provides a brief history of the industry,
discusses the effect on life insurers, uses a hypothetical case
example to illustrate the product's value, and concludes with "...we
think this market is a win-win for consumers."
Read article.
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NASD Guidance on Life Settlements: Best Execution Requires Broker-Dealers to Obtain Multiple Offers
In August, NASD issued Notice to Members 06-38 reminding
broker-dealer firms that life settlements involving "variable"
insurance policies are securities transactions and subject to
applicable NASD rules. The new rules include a "Best Execution"
obligation, which requires member firms to obtain multiple offers.
Broker-dealer firms seeking a strategic partner to assist them in
complying with 06-38 relative to Best Execution, Training &
Supervision, and other services we offer, should contact Marlene
Frith, Director of Marketing & National Accounts, at 1-800-561-4148.
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Charitable Giving and Life Settlements: Religious Ministry Chooses Life Settlement for $17 Million Key-Person Insurance Policy
As the leader in transacting life settlements for charitable
organizations, Advanced Settlements continues to demonstrate its
expertise as it relates to maximizing the value of life insurance
policies donated to, or owned by, charitable and religious
organizations. Recently, we transacted a life settlement for an
international televangelist organization that owned a $17 million
key-person policy with no cash surrender. The organization received
a substantial settlement that was used to purchase more suitable
replacement coverage and to expand the ministry. Advanced Settlements
is the first life settlement company to specialize in charitable life
settlements and has earned its reputation as the most experienced
company in this niche of the industry.
View case summaries.
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The Life Insurance Settlement Association (LISA) Releases White Paper
Entitled "Cashing in on Unneeded Life Insurance Policies," this
16-page white paper is an excellent resource for financial and
insurance professionals. Use it to introduce the product to your
referral network of CPAs and attorneys, or as a leave-behind when
educating seniors about the product. Scott Kirby, Vice President of
LISA and contributor to the initiative, calls the white paper "One of
the best resources available to educate consumers and regulators
about the value of life settlements."
Download here.
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Behind the Scenes: How Policies Reach the Secondary Market
As increasing numbers of hedge fund managers, investment banks, and
private equity funds enter the marketplace in pursuit of life
settlement portfolios, the demand for product flow increases.
However, few financing entities truly understand that for every 100
policies presented to funders, only 20 will reach the cash register.
Read our article published in the Summer 2006 issue of The Journal of
Structured Finance which presents a general overview of the life
settlement market; examines the dynamics and players involved in
product flow; and identifies the main drivers and constraints in
sourcing policies at the point of sale. The Journal is published by
Institutional Investor, Inc.
Read article.
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Dynamics of the Secondary Market: Settlement Brokers Are Keystone Players
Financial professionals engaging in life settlements should have a
clear understanding of the dynamics of the secondary life insurance
market and the role of brokers vs. providers. Settlement brokers
create an auction-like environment where multiple providers present
competitive offers for the same policy. Our article, published in
the August 2006 of California Broker Magazine, explains how
settlement brokers optimize the chances that a case will be matched
with the best pricing model.
Read article.
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Baby Boomers, Life Settlements, and Financial Strategies for an Aging Population
This year, the oldest of the 78 million baby boomers born between
1946 and 1964 are turning 60. Among those celebrating their 60th
birthdays in 2006 are George W. Bush, Bill Clinton, Cher, and Donald
Trump. Read how today's financial professionals will be challenged
to find ways to prepare the boomer generation to stretch their
retirement dollars, and the role life settlements will play for this
generation. Read our article published in the FPA "Solutions"
Magazine, July-August 2006 on this topic.
Read article.
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How Producers Are Building Their Book of Business
As the life settlement industry earns it way into the mainstream of
financial solutions available to seniors, two common business
development approaches being used by producers include reviewing
their current book of business, and building their referral network
among estate attorneys, financial planners, CPAs and other
professional advisors to affluent seniors. Read our article published
in the March 2006 issue of Agent Sales Journal on how agents can
strengthen their referral network and work in a collaborative "team"
enviornment to best serve the needs of their senior clients.
Read article.
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