Welcome to Life Settlement Review

Securitization of Life Insurance Settlements

Monday, 06 July 2009 16:46 Thomas S. Gallagher and Jonathan B. Ross

Life insurance settlements (“LIS”) constitute a potentially attractive candidate asset class for the issuance of rated securitized paper. The most recent longevity and demographic statistical information suggest that there will be a significant increase in supply of assets over the next 20 years. In 2007, there were approximately $9.2 trillion of life insurance in force in the United States. Of that amount, $416 billion in life insurance is owned by individuals over the age of 65. Only a small fraction of that amount, $15 billion in face amount, were sold or traded in 2007 in the secondary market.

Life Settlements and State “Blue Sky” Laws

Monday, 06 July 2009 16:56 James W. Maxson and Jason T. Cummings

The issue of whether the sale of life settlements are regulated as securities under state law must be analyzed in connection with each transaction. While in approximately 30 states a security or investment contract is defined explicitly to include an investment in a life settlement contract, the remaining states do not have such an explicit definition. However, there is little doubt that the remaining states would also interpret their securities laws to encompass life settlements. As a consequence, each party involved in a life settlement transaction must comply with state securities laws to avoid potentially severe penalties from state regulators.

Guide to Effective Media Relations

Thursday, 02 July 2009 17:56 Daniel Jimenez

1. Acknowledge the past. Do not try to ignore questions about past industry failures. Instead, address them early on in an interview. “Our number one strategy is to acknowledge up front that the industry has a questionable legacy and then transition into other current issues,” said Richard Weber, senior vice president for Blanc & Otus Public Relations in Austin, Texas. “Focus on the fact that the industry and regulation has largely weeded out the problem issues and the potential fraud that were pervasive in the early days. The goal is to have an honest discussion with the reporter in order to help them understand the whole picture.”

PR Expert Offers Advice on How to Fight Negative Media Coverage

Monday, 06 July 2009 12:41 Daniel Jimenez

It would be an understatement to say that the media has not been kind to the life settlement industry. It seems a month does not go by without another news report involving a consumer fraud case or a blogger warning seniors to beware of life settlements. Unfortunately, an argument can be made that the industry has often been its own worst enemy. The numerous cases of viatical and life settlement investment fraud that have made national media headlines in recent years would serve as supporting evidence for that argument. However, industry supporters would protest strongly that a small number of fraudulent players have unfairly tainted the reputation of an entire industry.

Market Expects Providers to Play Major Role in Industry Rebound

Thursday, 02 July 2009 17:28 Jim Connolly

A flagging economy may be putting pressure on profit margins, but do not expect institutional investors and private sources of capital to be directly approaching policyholders to sell their policies.The reason, according to those interviewed by Life Settlement Review, is a combination of economics, regulation and a need to ensure an orderly market so that there will be continued comfort investing in life settlements.

There is no doubt that the economy continues to be delicate even if it has stabilized to some extent. At press time, the Dow Jones Industrial Average continues to be in the mid-8,000 range, although the World Bank pronounced that the recession is deeper than forecast.

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