Transparency is not great in this market and so it's difficult to determine the price of these transactions, the actual returns that investors are going to receive, and the returns that an end policy owner receives as opposed to what's received by the brokers or
life settlement providers or investors.
The Conning report observes, too, that the industry's stakeholders -- investors,
life settlement providers and brokers -- are getting better at pricing the transactions.
In 2013, the top 15
life settlement providers paid more than $362 million for unwanted life insurance policies valued at over $2.
Released in 2010, ILMA's "
Life Settlement Provider Best Practices" is a guide of minimum compliance and diligence procedures for
life settlement providers.
Some
life settlement providers have created such arrangements that make it easier for agents to offer life settlements with less burdensome paperwork.
com, Eric Smith, had this to say of
life settlement providers offering money for your life insurance policy with few questions or underwriting, “If a company, or life settlement broker, is willing to offer you an immediate amount of money for your life insurance policy without knowing much of anything about your health, then you are likely looking at a very poor offer.
Statewide, there are 16 approved
life settlement providers.
Life settlement brokers represent policy owners for a fee or commission and may solicit bids for policies from multiple
life settlement providers with the goal of obtaining the best price.
In life settlement contracts, investors buy from
life settlement providers insurance policies from policy owners for cash, ultimately receiving the policy benefits when the insureds die.
All licensed
life settlement providers must file annual statements with the Superintendent on or before March 1st.
My hope is that the new task force will determine that greater regulation by the agency is necessary for
life settlement providers and brokers.
Typically, the life settlement broker will provide this information to the
life settlement providers from which the broker seeks purchase bids for the life insurance policy sought to be sold.
