Efficient, effective price discovery and completely transparent engagement with you.
We understand that as a wealth advisor or life insurance professional looking out for the best interests of your client and assessing the potential utility of a life settlement, while maximum bids and net proceeds are obviously of the greatest significance, a broader description of the value proposition of the transaction is important to consider. We deliver that.
We enable the price discovery benefits of real competition among multiple credible buyers without the opacity, inefficiency, and high cost of a broker. Importantly, you are intimately engaged in the process – with end-to-end transparency and an audit trail – and understood by your client to have been the driver of a high-value service win and significant windfall from an asset that would otherwise have been forfeited for little or no benefit.
All executed in a secure ShareFile bid room, not via e-mail and phone calls.
And not only do we execute the process faster and with far fewer unnecessary back-and-forths with your client, we generate winning bids that are typically substantially higher.
The highlights
20+
BUYERS REACHED
We engage 10+ Providers, the regulated entities that represent scores of capital sources, private equity, public and private pension, family offices, and insurance carriers
80%
SUCCESSFUL AUCTIONS
If we assess that your policy likely has positive value to the market, more than three quarters of auctions produce a winning bid that is sufficiently compelling to prompt a sale
15
DAYS TO ACTIONABLE BIDS
Our much simpler staging process gets you and your client to the auction quickly and then we complete the auction expeditiously, not wasting your and your clients' time
60
DAYS TO FUND
If you and your client are responsive to information requests and executing transaction documents from the buyer, sellers can receive funds in less than two months
THE TRUTH
why our process drives higher bids
While the analysis underlying the value of an in-force life insurance policy is complex and requires extensive domain expertise, the final calculation of the value is a simple DCF. Various risks are priced into an otherwise relatively simple IRR calculation, applying a discount rate to a projected stream of cash flows (premiums, death benefit) over a mortality curve.
Buyers often ascribe different values to each of these criteria, which can result in wildly variable valuations and the only way to compel buyers to bid as aggressively as their unique, "private value" dictates is our blind, best-and-final approach.
Even small differences in the assumptions about any of these criteria that underly an individual buyer’s assessment of a policy can result in significant differences in ascribed value – each buyer’s “private value.”
Unlevered Target IRR
Each buyer has a fund-level target IRR, but it may vary for an individual policy, depending on other factors (e.g., risk, duration, carrier).
Proprietary View of LE
Each buyer establishes, through analysis (or contracted) actuarial, bio-statistical, and medical staff, a proprietary view view of LE .
Price of Risks
Each buyer assesses and prices risks differently; concentration (insured and carrier), risk/cost of extension, of COI increase, etc.
Other Criteria
Policy size (too large, too small, too much on a single life), duration appetite, desire (or aversion to) for policy type, carrier, impairment, etc.
Engagement Calendar
1. Policy Valuation
Calendar: 1 day/<1 hour advisor time
While the market is the final arbiter of value, with a recent in-force illustration (level minimum premiums to age 100+), we can provide a qualified range of values under various health and discount rate assumptions to inform a discussion between you and your client about the likely utility of pursuing a sale.
2. Staging
Calendar: 5 days/4 hours advisor time
You simply upload to a ShareFile folder a copy of the policy, a signed HIPAA release form, two years of medical records (the more impaired an insured is, the more comprehensive the medical records that we'll need), the premium history (if a guaranteed product), and a copy of the Trust (if Trust-owned).
3. Case Review/Pricing
Calendar: 10 days/0 hours advisor time
The Providers that represent the major and reliable market buyers review policy, ownership, and medical documents, and pose any clarifying questions or request additional documents (e.g., other illustrations, medical specialist) to you and your client to refine their assessment of policy value.
4. Bidding
Calendar: 5 days/<1 hour advisor time
Upon completion of the Case Review period, interested Providers have 3 - 5 business days to submit to you their best and final bid and to detail any contingencies that will impact the amount of time and effort that you (the advisor) and your client will likely have to commit.
5. Contracting
Calendar: 15 - 30 days/0 hours advisor time
If your client wishes accept one of the bids, they will complete the Provider's life settlement application, after which the Provider generates a purchase agreement, funds escrow, and engages the carrier to change ownership. Funding then typically occurs within 10 - 15 days of the change request.