Agents and advisors should be looking at several key areas concerning the life insurance settlement market in the coming year.
Will there be a COVID-19 “effect” on life settlements?
We expect that within the next 12 months we will have a better idea of the long-term impact of the COVID 19 pandemic upon the life settlement marketplace.
With COVID 19 impacting seniors more than young people, it will be interesting to see if medical evaluations involving the pandemic will impact life settlement offers.
At the same time, we expect that more seniors who have tested positive and are dealing with “long haul” COVID symptoms may choose to look at life insurance life settlements as a way to help pay for medical costs.
The boom is on
Baby boomers will continue to have a major impact on the market. For the past several years and the foreseeable future, many prime life settlement candidates will be the baby boom generation. They represent a well-educated deep-pocketed audience that is currently navigating the retirement landscape in ways never before seen. We expect more boomers will be asking agents about life settlements. Perhaps they won’t be making a decision right away, but they will want to be educated and know their options for the future.
Life insurers sneak into the market with enhanced surrender values
Some life insurance companies have started to offer “enhanced” cash value offers to clients. The scuttlebutt in the industry is that some large insurance insurers have analyzed the policies that they have on the market and are actively trying to get clients to surrender policies via higher cash value offers. They either see dollar signs or vulnerability. Perhaps they believe that continuing growth of life settlement represents an existential threat. We don’t believe that any enhanced cash value offer will beat a life settlement.
Graysheeting is heating up
Graysheeting is a troubling trend in the life settlement industry, as agents and advisors are unwittingly handing over life insurance policies for sale in a marketplace that chronically undervalues them. The life settlement industry continues to evolve and this year has been no exception. We see continued growth for the industry as more agents and advisors educate their clients about the value of life settlements and how they can contribute to a better retirement.