Life Settlement Insights: Observations and Commentary on the Life Settlement Market.

Kindly supported by the European Life Settlement Association (ELSA), Life Settlement Insights is a compendium of articles examining the nuances of the life settlement market.

Fixed income investors are in something of a quandary; the zero lower-bound interest rate policies of western governments, designed to stimulate lending and therefore economic growth, has had a knock-on effect of dampening bond market volatility, and providing low – often negative – real yields. Many commentators are pointing out that inflationary pressures have returned, which may lead to a corresponding rise in interest rates; the consequence for government bond market investors of this being falling bond prices, and, therefore, underperforming fixed income portfolios.

Increasingly, investors are looking for other options when it comes to investing their fixed income allocation, and the Life Settlement industry is a growing part of the alternative credit sector that offers yield and uncorrelated returns.

The Life Settlement industry is predominantly one that is U.S.-based, as life settlement policies in most of the states of the U.S.A. are legally classified as property and can therefore be sold by the owner. As the U.S. population grows, a corresponding rise in the number of life settlement policies taken out by Americans is a reasonable assumption, which will lead to a larger industry, both in terms of the dollar size and the number of deals that can be done by participants, in the coming years.

The industry has some interesting idiosyncrasies. There’s no low-cost beta exposure available at all, and it’s a relationship-driven industry, with deals between investment manager and life settlement broker being conducted over the counter with brokers. The nuances of the space are fascinating, and we’ve produced Life Settlement Insights: Observations and Commentary on the Life Settlement Market to provide our readers with a comprehensive overview of the Life Settlement market, detailing the pros and cons of allocating to these strategies, and the outlook for future growth.

Our thanks go to ELSA and all of the individuals and companies that have taken the time to contribute to the report. Please click on the link below to download Life Settlement Insights: Observations and Commentary on the Life Settlement Market.

Life Settlement Insights: Observations and Commentary on the Life Settlement Market

We hope you enjoy reading.