Anyone in the life-settlement biz?

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Anyone viewing this thread should realize that a viatical settlement (life insurance policy sold by the insured) has two sides to the sale: a seller and a buyer.

The buyer has some cautions also. Here is what the State of Kansas says to prospective investors in viaticals:

http://www.ksinsurance.org/consumers/docs/investorviatical.pdf

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Let me just add a little something to this proposition... a little food for thought.

http://www.settlementwatch.com/Pages/CustomView.aspx?ID=75

 

[HomeService]

I knew I liked Kansas when I drove through there...

 

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Maple is one of the monsters in the industry. They are a provider (actual people who buy and hold) the policies. If you ever get a chance to hear Nate Evans (their CEO) or Alan Buerger (CEO Coventry) speak, I would highly recommend it.

There are plenty of clients who are taking advantage of this market. In 2007 the life settlement market did about 12billion in business.


FYI these people aren't screwing their kids and guido won't come hunting for them!

Alan Buerger is CEO of Coventry First, not to be confused with Coventry Health Care, which is the usual reference to "Coventry" on this forum.... here is the way they (Coventry First) work:

[SIZE=-2]Coventry First LLC Company Profile [/SIZE][SIZE=-1]Nikolai Gogol wrote about buying the names of dead serfs to build up the appearance of wealth, but Coventry First is more interested in buying their unused life insurance policies to build up actual wealth. The company is one of the largest players in the secondary insurance market. It actively invests in high-premium life insurance policies, written on elderly executives or wealthy individuals desiring to sell them rather than maintain them. The seller gets a lump sum (only a portion of what they would have received otherwise), Coventry pays the remaining premiums, and when that person finally dies, Coventry gets the payout. Founded in 1999, the company is controlled by CEO Alan Buerger and family[/SIZE]
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I knew I liked Kansas when I drove through there...

We shoot straight around these parts... have to: supper depends on it!

 

[lifesettlementadvisor]

lifesettlementadvisor:

You are obviously replying to the post above mine... you did not quote the post you were referring to.

If a client is confronted with a terminal illness, IF he has an "accelerated benefits" rider, he should use that, and not a viatical settlement.

IF he does not have this provision in his policy, then your option may be of some relief.... however, I would never sell a policy that did not include an accelerated death benefit rider, especially these days where death can be prolonged until the victim is completely drained financially.

Even LTCi may not be of much help, because the length of an illness can exceed the policy benefits.

The caveat with accelerated benefits is that they are usually capped at 50% of the equity. My question to you, is: what if a client has used up his accelerated benefits?... is a viatical settlement still available?

I want to know what will benefit my clients... What can you say to persuade me that a viatical settlement will not hurt anyone?

my post was not in reference to yours. i was writing my post when yours came up, sorry for the confusion.
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Also wanted to state that the VIATICAL (not life settlement) market is almost non existant. Most funders will not touch a policy with a LE of 24mo or less and most states (even unregulated life settlement states) require a seperate viatical license.

 

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Alan Buerger is CEO of Coventry First, not to be confused with Coventry Health Care, which is the usual reference to "Coventry" on this forum....

More info... this should be required reading!!

http://www.viatical-expert.net/images/PDFs/Ritchiev Coventry.pdf

In this lawsuit you can drill down to how the system works, and of the ethical problems uncovered by Coventry First by the AG of NY. Very good article!
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my post was not in reference to yours. i was writing my post when yours came up, sorry for the confusion.
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Also wanted to state that the VIATICAL (not life settlement) market is almost non existant. Most funders will not touch a policy with a LE of 24mo or less and most states (even unregulated life settlement states) require a seperate viatical license.

Sorry, but Viatical IS life settlement... are you talking about STOLI?

 

[lifesettlementadvisor]

Sorry, but Viatical IS life settlement... are you talking about STOLI?

No, I'm not talking about STOLI, BI deals are a completely different topic.

A Viatical is not the Same as a Life Settlement. If you call any life settlement provider and tell them you have a viatical settlement, they will hang up on you.

A Viatical Settlement is the settlement of a life case where the insured has a LE of less than 24 months due to age or a terminal illness.

A Life Settlement is the settlement of a life case where the insured has a LE of MORE than 24 months.

Viaticals are options for anyone with a LE of 24 months or less, regardless of age. Life Settlements are only applicable for seniors (65+).

If you would like an outside source, you can go to
Listing Of Authorized Viatical/Life Settlement Providers, Provider Representatives And Brokers from the Texas Department of Insurance
This is a list of all settlement brokers and providers in Texas. If you look at the key on the top of the site, it shows different designations for the different licenses people have to have if they want to work in the life settlement or viatical market.

 

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No, I'm not talking about STOLI, BI deals are a completely different topic.

A Viatical is not the Same as a Life Settlement. If you call any life settlement provider and tell them you have a viatical settlement, they will hang up on you.

A Viatical Settlement is the settlement of a life case where the insured has a LE of less than 24 months due to age or a terminal illness.

A Life Settlement is the settlement of a life case where the insured has a LE of MORE than 24 months.

Viaticals are options for anyone with a LE of 24 months or less, regardless of age. Life Settlements are only applicable for seniors (65+).

If you would like an outside source, you can go to
Listing Of Authorized Viatical/Life Settlement Providers, Provider Representatives And Brokers from the Texas Department of Insurance
This is a list of all settlement brokers and providers in Texas. If you look at the key on the top of the site, it shows different designations for the different licenses people have to have if they want to work in the life settlement or viatical market.

AH! Texas has set up regulations that license Viatical brokers and distinguishes between "life settlements" and "viatical settlements" --- Kansas does not. An attempt was made to enact this regulation beginning in 2004, but was terminated in 2007. Kansas came to the conclusion that this was a mess they didn't want to have to deal with. In Kansas, a viatical settlement is a life settlement and vice versa.
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Note: Kansas does not license viatical brokers, there is no such license.

 

[lifesettlementadvisor]

doesnt matter if the state requires a license or not, EVERYONE in this industry recognizes a destinct difference between viaticals and life settlements. its ok that you are wrong, this board is to learn, but you don't have to be so stubborn on it. Call any broker or provider and they will tell you the same thing!

Its like term and WL....they are both life insurance, but they are two different segments of the industry.

 

[retread]

doesnt matter if the state requires a license or not, EVERYONE in this industry recognizes a destinct difference between viaticals and life settlements. its ok that you are wrong, this board is to learn, but you don't have to be so stubborn on it. Call any broker or provider and they will tell you the same thing!

Its like term and WL....they are both life insurance, but they are two different segments of the industry.

I don't think you know what you are talking about. Traditional Life settlements are things such as AD&D, (double indemnity, etc), accelerated death benefits (usually ridered), and other settlement options that describe the payout.

The re-sale of life insurance in the secondary market is a new industry that has come under scrutiny, and is being addressed by the NAIC. Some states, such as Kansas have looked at the issues and are enacting consumer protections such as this year's restrictions on STOLIs.

Just because Texas allows it, does not mean it is accepted by the industry as a whole. It is possible that Texas may reverse its action and withdraw licensure.

That you have a vested interest in promoting this activity does not validate your comment that I am wrong. You are legal in Texas, but you would not be received well in Kansas.

And NO, it is not different like Whole Life and Term.

Stranger/Investor-Originated Life Insurance (STOLI) “Deals”
*Offered to consumers ages 65-85
*Allows strangers, not your loved ones, to own most of the death benefit from your policy
*You may be offered a lump-sum payment for signing over the death benefits to strangers
*The lump sum may be taxable
*The life insurance industry considers such “death futures” illegal
*The STOLI could leave you without future insurability
*National groups oppose such policies
*Traditional life settlement policies can be beneficial​

*Follow the “Stop.Call.Confirm” method for evaluation

---- taken from the Kansas Dept of Ins web site.

 

[lifesettlementadvisor]

man you have gone way off track. our argument in this thread has been about the difference between a viatical and life settlement, now you start in on STOLI's?

yes a stoli is a form of a life settlement (not a viatical, it is impossible to do a stoli on a person with a le of 24 months or less, for obvious reasons).

The STOLI market has dried up, but there are plenty of people still doing them. Most state's (including TX) have released a similar announcement about them, but have not made them illegal. The only state that has cracked down is OH. Personally I do not participate in the STOLI market, but can refer anyone to a group that does.