Life Settlements are truly a Win — Win

Bill Schantz is the CEO of Mid Atlantic Financial and an insurance executive with decades of experience. After graduating from Villanova University with a degree in political science, Bill Schantz went on to form Mid Atlantic Financial and Senior Settlements, LLC and also multiple smaller companies under the firm’s umbrella. Today, more than ever, he believes life settlements are a socially responsible investment, meaning that life settlements offer both great financial returns while also doing social/environmental good.

How do life settlements benefit the insured?
There are numerous reasons Insurance policy holders may consider selling a life policy:
• The premiums are no longer affordable.
• The need to replace lost income in case of death of the insured no longer exists.
• A term policy may be reaching the end of the coverage period.
• Funds are wanted to improve a retirement lifestyle.
• The need for funds to pay estate taxes no longer applies.
• The need to eliminate future premiums payments.
• There is a need for resources to pay for health expenses and long-term care.
• A business no longer needs key-man insurance.
• Premiums of policies owned by trusts continue to rise.

Buying a life insurance policy then becomes ethically acceptable. In the past, we have reviewed life settlements and concerns surrounding the ethical nature of investing in life insurance based securities.

In his detailed study, Empirical Investigation of Life Settlements Secondary Market for Life Insurance Policies, Narayan Naik, Professor of Finance, London Business School, shows that secondary life insurance market benefits both the investor and the insured selling their unwanted life policy.
Professor Naik, says: “The evidence suggests that the life settlement market has helped significantly in enhancing the welfare of policy-owners who, instead of surrendering, sold their life insurance policies in the secondary market”.

How do life settlements benefit the investor?
The payout of a life settlement transaction is not impacted by stock market volatility, interest rate fluctuations, variations in the economy, or foreign instability. The factors that do affect life settlement payouts are few, and they are considered very carefully for each policy before it is offered to a participant.

Returns are fixed at the time of investment and they are typically targeted at 10%+