The ABS Life Settlement Center
Our Life Settlement Division is focused on providing agents access to our industry leading educational resources, infrastructure, and negotiations model that garners top purchase prices for our clients. The combination of our scope of relationships with all of the markets institutional money sources, and adept negotiation skills helps us create unmatched demand for policies in this booming secondary market.
At its most basic level, the Life Settlement transaction is quite simple – selling a life policy for an amount greater than the surrender value or for a price that is material to the consumer’s needs. Yet, this “basic” transaction can be arduous or underdeveloped if an agent does not know the following:
• Who is a legitimate candidate?
• What is an average purchase price?
• Why a policy owner should consider selling their life insurance policy
• How many institutional money sources will be asked to bid on their file?
• How does the client and agent get paid?
• What is the gross offer?
Far too many agents are not commanding the highest purchase prices on the market because they are dealing directly with a single funder or they are working with a brokerage whose infrastructure is limited – only accessing a small number of funding institutions. How do these limitations impact pricing? The answer is very simple. It is impossible to have the most successful auction without inviting all of the leading bidders. In this respect, ABS’ infrastructure is unparalleled in the industry. We have relationships with every institutional money source in the market, both nationally and internationally. This depth of auction gives us the ability to create the greatest demand for policies being sold. As a result, our agents are providing their clients the highest possible settlement purchase prices, and at the same time maximizing their commissions.
The most illusive component of the Life Settlement process is the “Gross Purchase Price”. Obviously, the gross purchase price determines the consumer’s payout and the agent’s commission. Yet, in many instances, this gross number is not fully conveyed. Depending on the source that has handled a settlement transaction, far too often, fees are deducted before the purchase price is divulged to the agent. This is another significant reason why agents throughout the country subscribe to ABS transparent (full disclosure) negotiation model – we deal in the gross offer!
At ABS, we are consistently successful at producing top settlement offers, because we also maintain a strict discipline of presenting our cases to every possible funder on every case. Since millions of dollars can be infused into the marketplace at any given time by any given funding source, it is essential for ABS to remain impartial. In essence, there are no favorite funding sources. It is our focus to create the best offer for our clients that exists at that moment in time. Thus, ABS has positioned itself for successful negotiations by always accessing all money sources available to purchase policies.
Today, ABS invites you to “partner” with us in an effort to access the industry’s leading educational resources, infrastructure, and negotiations model. We are actively training hundreds of agents throughout the country today, and look forward to helping hundreds more harness the economic benefits of this transaction for the consumer and the agent.
What You Can Expect From ABS
ABS’ involvement will offer our agents the highest level of protection that each of your cases is being shopped properly. We will be a “one-stop-shop” for you providing:
• Industry Education and Training
• In-force Illustrations
• Access to Entire Auction Marketplace
• Medical Underwriting
|• Network of over 30 licensed institutional funders||
• Life Expectancy Evaluation
|• Full Disclosure of Gross Offer||
• Verification of Coverage
|• Personal Consultation||
• Case Management Updates
|• File Pre-Qualification||
• Development and Placing of Contingent Life Sales
Future of Life Settlements
It is clear that the Life Insurance industry has been “re-invented” with the advent of the Life Settlement marketplace. This secondary market has grown exponentially over the last few years, and has transformed in to a reputable institutionally driven “forum” to sell in force life insurance policies. Although the growth of this marketplace is staggering as reported in the latest Bernstein Research Study, we are still in the infancy of this cycle. The Bernstein Study also reports that the Life Settlement business will grow more than ten-fold to $160 billion over the next several years. At present, there is roughly $13 billion of total in force settlement business. Yet, as settlements become part of our business “culture”, it is estimated that this market will surpass earlier forecasts and exceed $300 billion in face amount settled over the next several years. With this in mind, it is important to take note that the target market for life settlements (i.e., individuals above age 65) should grow by 90% over the next 25 years, more than 3x the 23% growth rate of the total U.S. population.
Some entrepreneurs often reach a point where it may become difficult to move ahead, where they may become paralyzed by the work flow, and/or the service level required to maintain their current clientele. In terms of prospecting for new business, service, or communication, the organization of data in the ABS Affiliate Practice, in conjunction with the data mining system and the marketing wizard, will enable the agent to do much more with the same amount of time, growing their business in the process. Perhaps your practice is booming! But, to date, you may not have been able to transform your visions of success into reality. You may be thinking about your ability to someday sell, and receive a good value for your life’s work. The ABS Affiliate Practice could provide you the exit strategy you have been contemplating, a franchise concept which you own outright, which you can then sell when the time comes.