When I first looked into the life settlement industry back in 2003 it was something I was not familiar with and I research the field due to a person I know and
brokered the sale of a large portfolio consisted 200 policies of viaticle cases. The person I know made a fortune off this one deal and today he is a very
successful businessman who turned this one deal results to a one man business empire. As of now, he is not involved in this industry and mainly trusts
me and my company to provide him with the right and most accurate updates about the industry and its regulations. Lately, he approached me in an
unusual manner asking very specific questions about the industry. I was kind of surprised from the fact that a 34 year old self made millionaire with a net
worth of more than $25,000,000 shows such interest in my industry. Are coming back? I asked. "Yes" he answered.
The life Insurance Life Settlement Industry is growing very fast and each year more and more professionals understand the potential in this industry and
offer their clients with the Life Settlement option.
What is a Life Settlement?
A life settlement is the sale of a life insurance policy for a large cash payment that is better than the policy's cash surrender value,
A life settlement is defined as a financial transaction in which a policy owner holds an unwanted or not needed life insurance policy and sells the policy to a
funder who represents a bank or large institutions.
The purchaser becomes the new owner and beneficiary of the policy and is responsible for all following premium payments.
Life Settlement or Life Settlements, also known as senior settlement Is a concept that getting more and more popular among people who do
not want continues paying the premiums for their unneeded / unwanted life insurance policy
Reasons for selling the policy
· Children are all grown up and doing well
· Need cash for retirement
· Eligible for better performing product
· Need funds for Investment
· Premium on policy become to be very expensive
· Change in your estate structure and worth
· Divorce or outlive the beneficiaries
· Need large amount of cash and do not want to liquidate assets and savings Want to give large amount of money for charity while alive
· Help beneficiaries before passing away.
· A company key person insurance policy is no longer needed
· The life insurance coverage is related to an obsolete buy/sell agreement
Recent articles, surveys and research show that this industry is yet to reach it full capacity and will grow tremendously in the next few years
Few statistics will put the opportunity in perspective:
· By 2030, there will be about 70 million older Americans, more than doubling the 1990 number. In the year 2000, about 13 percent of the population will be
65-plus. In 2030, that rate will increase to 20 percent, or one in every five Americans. (U.S. Census Bureau)
· 47% of seniors over age 65 own life insurance. (Bernstein Research Call)
· 59% of life settlement clients are between ages of 71-80. (National Underwriter)
· 20% of a policy's face amount is the average payout to life settlement sellers. (Deloitte Development LLC)
The numbers are staggering:
· Approximately $431 billion of life insurance in force
· 88% of Universal Life policies never result in a claim
· Approximately $15 billion worth of Life Settlement transactions will occur this year.
· That figure is a 100% increase over last year. Another 100% increase is expected next year.
· The market is expected to grow to over $160 billion over the next several years.(Bernstein Research Report, June 2005)
Boaz Arbel is the general manager of Arbel Life, LLC a New York based company that specialized in the high net worth senior market. To get more information about Life insurance Premium Finance, Life Settlement and to read more articles about the subject please visit Arbel Life, LLC web site at http://www.arbellife.com
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