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Tuesday June 03, 2008
After a long binge of borrowing, U.S. consumers face a credit crunch and a sagging economy. To sustain their living standards, many Americans are doing what comes naturally: scrambling to raise more cash.
Sheron Brunner, 63 years old, bought a $250,000 life-insurance policy in 1997, planning to leave the proceeds to her three children. She faithfully made her $113 monthly payments. But after retiring in 2002 from her job running a homelessness-prevention program,… Click here to read more!
Sunday May 25, 2008
Because it has been traditionally considered an illiquid financial asset, a debtor's life insurance policy typically receives little attention from many bankruptcy trustees. Due to an evolving secondary market for life insurance over the past several years, however, bankruptcy trustees may now be able to unlock the value of a life insurance policy for the benefit of creditors through a life settlement transaction, according to specialty finance company J.G. Wentworth.
With the evolution… Click here to read more!
Wednesday May 14, 2008
Here is an interesting concept, investing on the life of a stranger, or, infact, investing on the years remaining in a stranger's life. If this sounds strange to you, warm yourself up to the idea of calculating your ROI based on how much longer your investment subject lives, because this is becoming one of the hottest trends in the investment industry.
STOLI, or stranger-originated life insurance, is life insurance issued on the life… Click here to read more!
Tuesday May 06, 2008
This blog is the first of a three-part series that covers the major terms associated with life settlement transactions. Both viatical and non-viatical transaction terms are included here.
Terminal Illness – An illness or malady that will most likely result in death within the next two years.
Chronic Illness – This can be defined as one of two conditions: The first is an inability to perform at least two… Click here to read more!
Monday April 28, 2008
This blog is the first of a three-part series that covers the major terms associated with life settlement transactions. Both viatical and non-viatical transaction terms are included here.
Life Settlement - When a client owns a life insurance policy that is no longer wanted or needed, he or she can sell the policy to a third party for more than the cash value that they will receive from the life insurance company. The buyer is then named as the new beneficiary of the policy… Click here to read more!
Monday April 21, 2008
Since the dawn of the insurance industry, policyholders have looked for a way to get out of their policies that they no longer want or need. However, this service has been a long time coming for policyholders who need cash now in lieu of a death benefit. A 1911 judicial ruling established that life insurance policies are transferable by the policyowner, and this was a critical step forward for the industry. However, it was not until decades later that further progress was accomplished. Life settlements… Click here to read more!
Tuesday April 15, 2008
Even though the life settlement industry is still in its infancy, major changes and improvements are on the horizon. Up until now, business has been traditionally geared toward larger policies worth at least $250,000, with an average underwriting time per transaction of at least 45-90 days. But a revolutionary new, streamlined process known as CSF is going to open up a new world to brokers, agents and planners who have clients with life policies that are no longer desired or necessary. CSF will… Click here to read more!
Saturday March 22, 2008
A must-have tool for all financial planners, CPAs and Estate Attorneys- Life Settlements.
The competitive secondary market for insurance policies has created a new tool to help estate planners with clients whose estate needs have changed. Life settlements, the act of selling unwanted insurance policies through a bidding process to 3rd party buyers, have Estate planners and tax attorneys jumping for joy.
The act of life settling should be considered if your clients meet the following… Click here to read more!
Sunday March 16, 2008
Seniors can now find 3rd party buyers for their unwanted insurance policies. And yes, they now have a plethora of choices as various Life Settlement Providers bid against each other to get their hands on these valuable assets deemed useless by their original owners.
Elderly Americans with policies they do not need or cannot afford to keep have had little option but to let the policies lapse or sell them back to their insurers. Plenty seem glad to have an alternative buyer. No wonder, when… Click here to read more!
Wednesday March 12, 2008
An electronic marketplace for life settlements is slowly emerging.
Before the end of the first quarter, The Goldman Sachs Group Inc. and National Financial Partners Corp., both of New York, are expected to launch the Institutional Life Services electronic platform for life settlements.
It will compete against LexNet, an eight-month-old online-auction market operated by the LifeMarkets division of New York-based Cantor Fitzgerald LLP.
Last… Click here to read more!
Friday March 07, 2008
LiveSettlements, which bills itself as a life settlements portal providing life settlement and life insurance news and resources for the consumer, launched yesterday...
"We will try to be as independent as possible," he said. "It's important that consumers see both the negatives and positives [about life settlements]. I want to position us as the leading source for helping consumers make informed and educated decisions."
He said he… Click here to read more!
Thursday March 06, 2008
LiveSettlements, an independent life settlements portal providing senior settlement and life insurance news and resources, launches at www.livesettlements.net. Seniors can leverage LiveSettlements.net to obtain an instantaneous life settlement quote and make informed decisions on selling their insurance policies.
Beverly Hills, CA (PRWEB) March 6, 2008 -- LiveSettlements.net… Click here to read more!
Monday March 03, 2008
The "senior settlement" has emerged recently as a hot new financial instrument, but law enforcement officials and some financial advisers caution investors against dishonest practices by unscrupulous salespeople and companies.
Senior settlements, also called life settlements, are similar to viatical investments. In these arrangements, a person 65 or older who no longer needs an existing life insurance policy—typically worth $1 million or more in most transactions—sells it for less than its… Click here to read more!
Sunday March 02, 2008
One of the most frequent questions that we get asked is what are the steps involved when selling your policy and how long does it take. Let’s first look at what is involved:
1. A need is realized – either the insured or their advisor recommends considering a life settlement.
2. Application – the policy owner completes the settlement application and provides any initial necessary documentation to the settlement company.
3. Documentation – the settlement company reviews the application… Click here to read more!
Saturday March 01, 2008
A Discussion of the Taxation of Life Settlements Introduction With the growing popularity of the selling of life insurance policies for life settlements, policyholders are benefiting from settlements two to four times greater than their surrender value. Term policy owners, especially, are benefiting from selling their policies, once deemed to have no value upon surrender. These policy holders are enjoying their life settlements in a variety of ways including:
• Paying off debts
• Provide… Click here to read more!
Thursday February 28, 2008
There are alternatives to selling your life insurance policy to a third party. If you need money now but you still want to maintain your current policy, there are alternatives. These include:
- Borrowing against your policy – some insurance policies will allow you to borrow against your policy, though this will decrease the death benefit if you pass away before the policy is repaid.
- Accelerated death benefits – also called viaticals, this allows the policyholder to receive either… Click here to read more!
Monday February 25, 2008
With the first baby boomers now officially reaching retirement age, many are looking at life settlements as an alternative to surrendering or letting their insurance policies lapse. Whether because of their inability or desire to continue to pay rising premiums, or because of the lack of need for the policy, they are realizing the benefits of having the option to sell.
For those that qualify, life settlements can provide a cash infusion greater than the surrender value of a policy. They can… Click here to read more!
Friday February 22, 2008
A worthy investment at the right time can indeed make a major difference to your life and stands you in good stead when the time comes. So, most individuals make intelligent investments while they are in active service in order to secure their old age. Some of the most popular forms of investment are property, jewelry, bonds, mutual funds and of course a life insurance policy. The life insurance policy can be a worthwhile investment because of the immediate liquidity that it can provide to the insured… Click here to read more!
Thursday February 14, 2008
Depending on your point of view, the solicitation landing in many local mailboxes sounds too good to be true or downright creepy. If you qualify, you can get thousands of dollars by selling your "unused insurance capacity" to an investor who gets the death benefit when you die. Senior Wealth Planning Group of McDonough, Ga., has been offering to buy this "valuable hidden asset" from local residents who are ages 72 and 86, have at least $2.5-million in assets and do not have a disqualifying health… Click here to read more!
Thursday February 07, 2008
Life settlements also known as life insurance settlements, senior settlements, or senior life settlements have quickly become an important tool for insurance agents, financial planners, estate planners, elder law attorneys, and other financial related professionals.
A life settlement is a financial transaction in which a senior citizen policy owner of an unneeded, underperforming, or unwanted life insurance policy sells the policy to a third party, as opposed to surrendering or lapsing it… Click here to read more!
Saturday January 26, 2008
Since everyone dreams to live a prosperous and financially free life, financial services that are helpful in making this dream true, are getting high heed by consumers. Purchase of life insurance policy is one of those financial activities that are helping people in securing their future financial requirements. These life insurance policies are helping people in making their old age hassle free to some extent but when it comes to arranging urgent finance for any emergency requirement, these policies… Click here to read more!
Tuesday January 15, 2008
BOSTON (MarketWatch) -- Everyone could use a little more money, but needing that cash desperately and in a hurry leads consumers to make a lot of mistakes. While the typical mistakes involve payday-advance loans or tax-refund anticipation loans, one big concern for senior citizens in need of cash is the "life settlement."
Life settlements aren't a particularly well-known part of the financial landscape, but they are becoming increasingly popular -- and increasingly dangerous. To that end,… Click here to read more!
Wednesday January 09, 2008
With his only child entering college and a wife who works, David Blumenthal, 64, a mortgage broker in Philadelphia, recently concluded that he was carrying more life insurance than his family needed. But after paying premiums for five years on $1 million of term coverage, he didn't like the idea of simply letting the policy lapse and walking away empty-handed. So he took advantage of a relatively new option.
Blumenthal, who is in good health, converted his term insurance into two separate… Click here to read more!
Friday December 28, 2007
Across the country a strange new wave of investors are targeting senior citizens by purchasing high-end life insurance policies for them. The investors are offering to buy policies for older Americans and then pay their premiums. It is creating another sector of the life insurance world that focuses on buying, selling and generating profits from life insurance products.
Typically, the way the offer works is that the senior citizen is offered a loan to purchase a life insurance policy and… Click here to read more!
Thursday December 20, 2007
Seems like people will figure out how to make a buck out of anything. Lately, this includes death. Don't get me wrong: Since the dawn of man a lot of people have been making a lot of money on death. Death sells, for the reason that it is the big unavoidable. Morticians and those who sell burial plots are getting ready to go through their biggest up cycle ever as the baby boomers start cashing it in. And life insurance has always been a very lucrative business, though the trouble with life insurance… Click here to read more!
Monday December 10, 2007
Let's say that you are diagnosed with a terminal illness, such as serious cancer or AIDS, but you don't have sufficient money for treatment or even to keep yourself comfortable until you die. But let's say that you do have a life insurance policy, although in such a case you'll find that it does you pitiful little good until you do cash it in. So, you find somebody who will buy your insurance policy now at some reduced value, knowing that very shortly they will be able to cash it in. This gives… Click here to read more!
Sunday December 02, 2007
So the viaticals mess left a multi-billion dollar business with relatively few real victims of disease to buy policies from. But one of the great things about America is the ingenuity of our capital markets, and their ability to not just let money sit around but to put it to work. It was just about when the viaticals markets were starting to fall apart that some very bright person looked at the situation and said,
"Hey, what about people who aren't terminally ill, but whose health has gone… Click here to read more!
Friday November 23, 2007
From the old codger's viewpoint, it is a great deal for him too. Since he couldn't afford to make current payments to keep the policy up anyway, in his mind the value of the policy was a precisely calculated "$0". And here you come along and give him $500,000 hard cash for it. Sucker!
Wait, you say, how can this "win win" situation be? Not everybody can be a winner in a transaction, right?
Absolutely right. In this situation there is a loser, and a big loser too. It is the old codger's… Click here to read more!
Sunday November 18, 2007
SAN FRANCISCO (June 4, 2007) — The National Association of Insurance Commissioners (NAIC) today adopted amendments to the Viatical Settlements Model Act during the Association's Summer National Meeting in San Francisco.
The Model, which has been widely discussed among state regulators, addresses several issues in the life settlement marketplace, including an emerging type of life insurance practice known as Stranger-Originated Life Insurance (STOLI). The Model strengthens several consumer… Click here to read more!
Tuesday November 13, 2007
The point is that a life settlement is only a good deal for folks who have no beneficiaries or estate needs of any kind. If you take into both family and charitable aspirations, this is a very small market. If an old codger has heirs that he wants to benefit, or any other estate needs, then life settlements are not a suitable strategy. Instead, the old codger should do anything he can to keep the policy going, just like the investors would do if they got it.
So, there are several significant… Click here to read more!
Thursday November 01, 2007
This leads us to the most significant problem involving life settlements, which is suitability. Usually, the issue of suitability relates to the agent selling a senior something which they don't need. Here, the suitability issues relates to the agent incorrectly advising the senior to sell something that the senior should be holding.
In many ways, it really is no different than if the senior held a Certificate of Deposit that would pay $10 million in ten years, and the agent came and convinced… Click here to read more!
Thursday October 25, 2007
As egregious as the life insurance agent's conduct sounds, many of them are starting to tell their seniors that they can repeat this process "every two years" which leads to the next problem, that of insurable interest.
The concept of insurable interest means that you have something worth insuring. In addition to other things, this keeps people with nothing to lose from buying a lot of life insurance and then suddenly being found dead. The concept of insurable interests is why the bum at… Click here to read more!
Tuesday October 16, 2007
Yet, it is not easy to get the attention of wealthy people to enter into these transactions, and they usually don't want to take a medical examination or having people prying into their private lives, so the insurance agent must offer substantial bait. This bait usually comes in the form of large amounts of cash paid up-front.
How much cash? On a $10 million policy, the wealthy person might get as much as $500,000 up front just for taking the medical examination and signing the application.… Click here to read more!
Saturday October 06, 2007
So where do all these life settlements end up? Most of them end up in pools owned by large financial institutions and hedge funds. The firms monetize the policies and sell interests in the pools to the investors, which are usually even larger investment or pension funds. That is what happens most of the time.
There is a concern, however, that particular life settlement contracts could end up in the hands of seedy elements. Or as Steve Leimberg of http://leimberg.com puts it, "How well would… Click here to read more!
Thursday September 27, 2007
Some of the life insurance companies are concerned about life settlements. This concern has nothing to do with lapse rates or death pools, and everything to do with Congress. Their concern is that if Congress realizes that life insurance policies are really just investments, Congress will start taxing them the same way as other investments.
Life insurance has a huge tax advantage over most other investments insofar as its value is allowed to build up tax deferred and no income or capital… Click here to read more!
Sunday September 16, 2007
So what do you do if you have already been talked into a life settlement and then were talked into buying replacement insurance? You should talk with an attorney to determine whether the original sale made sense, and whether your life insurance agent fully explained to you that it might have made more financial sense to continue to fund the policy than to sell it. You should also talk to your attorney about whether your life insurance agent explained to you that the cost of insurance might be higher… Click here to read more!
Tuesday January 09, 2007
Here are some real-life examples of how a Life Settlement can help you:
- A 74-year-old retiree has a term life insurance policy he has had for 20 years which is nearing the end of its term. Because the premiums will substantially increase if he renews the life insurance policy, he was going to let the policy lapse. Since it is a term policy, it has built no equity or cash surrender value, so he would receive nothing upon surrender. By selling the life insurance policy to a provider he not… Click here to read more!
80 Year Old Female
