A life settlement, or reverse life policy, is the transfer of ownership and beneficiary rights of an unwanted or unneeded life insurance policy in exchange for a cash settlement.
In the past, policy owners who no longer needed or could no longer afford their existing coverage had few options, and would typically cancel the policy and lose all premiums paid during their life. The surrender value offered by Issuers are generally very low or non-existent. In addition to providing a real social benefit to policy owners, this market offers investors an opportunity for investors to generate above market yields.
Investing in life settlements as an asset class provides several attractive features such as:
- Uncorrelated Returns – since cash flows are based on the life expectancy of the policy holders, investment returns are independent of traditional financial markets.
- Strong Creditworthiness – returns are backed by some of the world’s largest insurance companies.
- Attractive Yields – the current average implicit market rate on the secondary market is 13-14% per annum.
- Regulatory Structure – the industry is highly regulated and structured.
- High Growth Potential – given the growth of the senior population, the market volume is expected to grow steadily in the future – thus improving liquidity.
We offer investors several options to gain exposure to this attractive asset class:
- An open-ended fund with monthly valuation and quarterly liquidity. This regulated fund has a 10-year successful track-record and more than $1bn in AuM.
- A closed-end fund vehicle, with quarterly distributions and an expected net return of 15% per annum over the next 10 years.
- A separate managed account, that may be tailored to suit specific investors’ needs.
The management team has an extensive experience in the industry, with the best credentials and track-record. The portfolios are traded on a regular basis and are valued at current market prices. The valuation process is fully transparent and externalized to world-class valuation partners. The portfolio and the valuation process are audited on a monthly basis.
This rigorous organization combined with an outstanding experience and know-how is a mark of constant and superior future returns for investors.