Author: Greg Winterton
Whilst 2023 is not quite in the books just yet, it has been another busy year in the UK pension risk transfer (PRT) market. In October, consulting firm Barnett Waddingham published a blog post suggesting that this year is set to break records in terms of both the number and volume of deals. Those in the UK licking their lips at the prospect for 2024 bringing ever more deals might want to rein in their excitement, as the regulator is paying close attention. In mid-November, the Bank of England’s Prudential Regulation Authority (PRA) issued a consultation about the funded reinsurance…
A new report asset manager, Conning, suggests that the outlook for growth in the life settlement market is generally positive. Life Settlements: Steady Growth Ahead is the 18th annual report the Hartford, CT -based company has published covering the life settlement market. The report covers a range of factors relevant to the life settlement market, including drivers of demand for life settlements among consumers and investor interest in asset classes such as life settlements. Conning’s bullish view is supported by trends in each of these areas. “Conning’s analysis of the factors driving life settlement growth are mostly positive. Consumers are…
UK industry group the Equity Release Council (ERC) published its quarterly update recently, showing a market that has returned to growth for the first time in a year; both new customers and total lending in the market increased (10% and 8% respectively) from the second quarter of this year. Market activity remains suppressed when compared to recent years, however. The first three quarters of 2023 have delivered three of the five lowest periods of activity since at least 2017, and the number of new plans agreed nosedived at the end of 2022 (although that has plateaued, perhaps indicating a natural…
In September, the US Federal Reserve maintained interest rates at 5.5%, the first pause in what has been a rising rate environment since early 2022. Similarly, the Bank of England kept its interest rate at 5.25%, the first time since 2021 that the rate had paused. So, in October, we asked our readers whether they thought that this marked the end of the recent rising interest rate environment. In a rare turn of events, Life Risk News readers were split; 42.1% said they thought that the rising rate environment had now seen its peak, and 42.1% said that there were…
A recent report published by asset manager Conning suggests that the life settlement industry is poised for continued growth in the coming years. Life Risk News’ Greg Winterton spoke to Rob Haynie, Managing Director at life settlements broker Life Insurance Settlements, Inc, to get his views on how the life settlement market has done in 2023 and what his expectations are for 2024. GW: Rob, let’s start with 2023. At the end of last year, you told Life Risk News that you expected the main reasons why seniors look to sell their policies to be covering medical bills and simply…
Deal flow in the life settlement industry’s secondary market can be separated into two main channels – the direct-to-consumer market, where insureds sell their policies to a licensed life settlement provider, perhaps because they have seen or heard TV or radio advertising – and the intermediated channel, where life insurance agents, accountants, attorneys and wealth managers work with their client to sell their policy via a licensed life settlement broker. In the intermediated channel, deal flow from the wealth manager – registered investment adviser (RIAs) – cohort is on the rise. And the increased activity is coming from what is,…
The rising interest rate environment of the past 18 months has had a significant impact on the alternative investment industry, with fundraising across all the main segments – hedge funds, private equity, private debt, real assets – falling in 2022 and then again this year as global capital allocators pivot to assets that are perceived as having lower risk, higher liquidity and now, for the first time in more than a decade, an acceptable yield. The impact has certainly been felt in the life settlement market. “You can get a four-week US treasury bill for around 5% at the moment,”…
Life Risk News UK Pension Risk Transfer Consultants roundtable
The life settlement industry tends to measure its size based on the US dollar value of policies transacted in the space’s secondary market, which was $4.5bn in 2022, according to data published in the summer by The Life Settlement Report, part of The Deal, which uses data from state insurance departments to collect this information. The industry’s tertiary market is, by most accounts, much larger. And almost all funds will transact every year. But exactly how large is the market? It’s difficult to know because of a lack of publicly available information. And specifically, we’re looking at AUM here, so…
Consumer awareness in the secondary life settlement market is a perpetual hot topic in the industry. Greg Winterton spoke with Michael Freedman, CEO at life settlements provider Lighthouse Life, to get his take on the current state of consumer awareness in the space and what could be done to improve. GW: Michael, let’s start at the beginning. If you were grading the current state of consumer awareness in the space, what grade would you give, and why? MF: Greg, thanks for the opportunity to share some thoughts related to consumer awareness in life settlements. Consumers’ – particularly seniors’ – awareness…