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 large, closed-ended, private equity-style funds will be raised that are purchasing large blocks of policies each year. So, for this month’s poll, we asked Life Risk News readers what they thought.
A massive 77.3% think that the market manages more than $25bn in AUM at the moment, with the remaining respondents saying that industry AUM is between $5 and $25bn. None think it’s less than $5bn.
The actual number is, of course, unknown. But what’s certain is that the life settlement market itself thinks that it manages a not-insignificant amount of capital. They will be hoping that efforts to grow the size of the secondary market will drive the space to greater highs in the coming years.