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2020: Life Settlements - The COVID-19 Impact on United States Life Settlements

  • Report

  • 85 Pages
  • October 2020
  • Region: United States
  • Conning, Inc
  • ID: 5530873
The life settlement market in 2019 enjoyed its fourth consecutive year of growth in the amount of face value settled. Looking ahead, the combination of a prolonged low interest rate environment, continued investment allocations to noncorrelating alternative asset classes, and the stability of the life settlement landscape points toward a continuation of that trend. That said, the life settlement industry is likely to have some impact from the COVID-19 pandemic that has disrupted the markets.

This 15th annual life settlement review takes a preliminary look at the potential impacts COVID-19 could have on life settlements. Some of these impacts could represent longer-term challenges and opportunities for life settlement investors.

The analysis of those insurers identifed as being targets of life settlement investors continues. The report compares their financial strength, as measured by risk-based capital levels, against the remaining industry. The publisher continues analysis of death claims, lapses, and surrenders. This analysis provides useful insight for investors on the financial performance of the companies that issued the policies in their portfolios and the possible impact life settlements may have on those companies.

  • This study reviews this diverse secondary market for insurance products.
  • It provides our preliminary consideration of COVID-19’s impacts on life settlements.
  • It reviews the current market and provide our forecast for 2020-2029.
  • It analyzes the performance of those insurers targeted by life settlement investors and compare them to the broader life industry.
  • As always, for new investors curious about life settlements, the report provides an introductory primer of how life settlements operate.

Readers can use this report to:

  • Review the development of the life settlement asset class since 2002
  • Forecast the growth of life settlement volumes through 2028
  • Develop market projections for use in investor presentations
  • Monitor the financial strength of the insurance companies targeted by life settlement investors
  • New market entrants use the report as a primer on life settlements as an asset class

Key research questions for 2020:

  • What has been the short-term impact from COVID-19 on the life settlement industry?
  • What are the long-term implications created by COVID-19 on the life-settlement industry?
  • What are the key drivers of life settlement growth over the next 10 years?
  • What is the size of the life settlement market in 2019 and over the next 10 years?
  • How could the financial performance of insurers targeted by life settlement investors affect investor returns?

Table of Contents

1. Introduction2. Executive Summary
3. Life Settlement Market Review
a. COVID-19 Current and Longer-Term Impacts Uncertain
b. Life Settlement Market Review
c. Summary
4. Life Settlement Forecast Drivers
a. Economic and Capital Drivers
b. Consumer Drivers
c. Industry Drivers
d. Tertiary Market Drivers
e. Summary
5. Life Settlement Market Forecast
a. Conning’s Life Settlement Market Forecast
b. Conning Tertiary Market Forecast
c. Summary
6. Life Settlement Insurer Performance
a. Insurers with Life Settled Policies Performance Review
b. Portfolio Performance and Net Operating Gain
c. Life Insurer Concerns About the Impact of Life Settlements
d. Summary
7. Appendix - Life Settlement Market Structure and Risks

Companies Mentioned

A selection of companies mentioned in this report includes:

  • Ashar Group
  • Corry Capital
  • gWg Holding
  • Lighthouse Life
  • MLF Financial Group
  • NorthStar Life Services LLC
  • RedBird Capital Partners
  • Vida Capital
  • Welcome Funds