Insurance & Alternative Solutions, LLC.

Alternative Investment Solutions

No Stock or Real Estate Risk

Alternative Investment Diversification Solution*

Currently only offered to California residents that are qualified investors

Diversification is the spreading of your investments both among and within different asset classes.

Most investors are diversified amongst various equity position that could include domestic and international investments as well as safer investments like bonds that may include US government, domestic or foreign corporate bonds. and possibly other types of alternative investment their advisor may offer. That is great but many of these investments contain a certain level of stock market and real estate risk. Therefore, an alternative investment that may be a compliment to your current investments should not contain stock market or real estate risk allowing for further diversification of your overall portfolio.

An investment that allows further diversification and is not correlated to the stock market or real estate risk is a Life Settlement.

When a life insurance policy owner sell their life insurance policy to an investor or third party for cash, this transaction is called a life settlement.

Why invest into life settlements?


For decades, only ultra-wealthy and institutional investors (Warren Buffett, big banks, investment companies, etc.) could afford to buy life settlements. However, in 2000 the state of California introduced Senate Bill 1837, allowing the average investor to purchase a fraction of a life settlement. Rather than one wealthy investor purchasing an entire insurance policy, now the average investor can own a small portion of that policy.​What makes life settlements so attractive to qualified investors is the diversification provided and the non-correlation to the stock market.

Qualification Requirements per California Law that must be met (Must be a California resident.

  • Accredited Investor based on net-worth of $1,000,000 (exclusive of primary residence, its furnishings and automobiles).

  • Accredited Investor based on income $200,000 for current year and past two years ($300,000 if married-filing-jointly).

OR

  • Qualified purchaser (1) $150,000 net-worth (exclusive of primary residence, its furnishings and automobiles) AND income of $100,000 plus.

  • Qualified purchaser (2) $250,000 net-worth (exclusive of primary residence, its furnishings and automobiles).

Note: If an investor is financially Qualified but not Accredited, they are limited to investing no more than 10% of their stated net-worth exclusive of primary residence, its furnishings and automobiles. For an Accredited Investor no more than 20% of their stated net-worth.

Note: If you are NOT a California residence inquire within.

Selling Your Unwanted or Unneeded Life Insurance Policies


If you or your clients no longer want, need, or can afford their life insurance policy, a life insurance settlement can be an important option. They can sell them (yes, even term policies) and receive cash. This should be a win-win for the policy owner and the buyer of the policy.

Warning: We will always strongly recommend the policy owner should hold onto their life insurance policy in order for their heirs to receive the death benefit amount. As part of our evaluation, we will analyze and advice if you can use other assets "less valuable" to maintain the policy for their heirs.


After all alternatives have been considered, and the conclusion is that it is time to lapse or surrender a policy, a life settlement can offer a significantly greater value.​

Consider this statistic: According to research from the Insurance Studies Institute, more than 500,000 seniors lapse their life insurance policy every year. An additional 2,000,000 seniors surrender their policies annually! Only 3,100 took advantage of a life settlement last year. About 90% of seniors report that they would have considered a life settlement if they had been made aware of the option.

FAQs

What is a life insurance settlement?

A life insurance settlement is the sale of a life insurance policy to a third party for an amount greater than the cash surrender value. Typically, the sale involves an insured age 65 or older with a policy that is no longer needed, wanted, or affordable to an investment company that provides the owner of the policy with a lump sum cash settlement.

This secondary market for life insurance contracts provides an alternative to accepting the issuing insurance company's surrender value for the policy.

What are th​e most common life insurance settlement situations?

  • The Sale of a Business or Illiquid Asset

  • Business Owner Retiring or Exiting the Business

  • A Decline in Estate Value and/or Decrease in Estate Tax Liability

  • Term Policies or Riders That Are About to Expire, Lose Their Conversion Privilege, or Come to the End of Their Current Premium Guarantee

  • Retirement

  • The Policy Is No Longer Affordable Due to Policy Performance

  • Chronic Illness

W​hat types of policies can qualify for a life insurance settlement?

  • Universal Life

  • Convertible Term

  • Whole Life

  • First-to-Die or Second- to- Die

  • Group Life, If Convertible

What is the minimum face value of a policy that can be sold?

The minimum face value can be as low as $100,000.

How do investors determine how much they will pay for a policy?

Each client and situation are unique, as are each investor group's objectives. There are many factors used to determine the value of a policy, but the basics are:

  • Age

  • Health History

  • Policy Face Value

  • Type of Policy

  • Premium

  • Policy Loans

  • And more...

How long does the process take?

Typically, the entire process from application to completion can take 2 - 4 months. It can take 2 - 3 months to receive offers from investors, and about 30 - 60 days to complete the paperwork, if an offer is accepted. But, every client is different and the process can be a little shorter or longer, depending upon the circumstances. If selling a term policy, we recommend starting at least 6 months prior to the end of the term to allow plenty of time for completion.

D​oes it cost anything to apply?

We work with a strategic partner who is a broker and who shops with over 30 investors to get the highest offer possible. They are passionate about taking care of clients, and believe they need to earn your business! There is no cost to apply and there is no obligation. If the client does not approve of the amount offered by an investor, that client can simply walk away. It can't hurt to try - It can only hurt not to!

How can I receive more information about life insurance settlements​?

Please feel free to call or email us if you would like to discuss a potential life insurance settlement situation, have any questions or would like additional information. We are delighted to help! We also have a 20-page consumer brochure available which is published by the Life Insurance Settlements Association (LISA), as well as a brief informational flyer. To request a copy of the brochure or flyer, please contact us or fill out the form on our "contact us" page, and we will send it to you. Thank you for the opportunity to be of service!

Office: 661.368.5296

Fax: 661.554.6551

28338 Constellation Road

Suite 900

Valencia, CA
91355

CA Insurance #0E77552, AZ, NV, ID, FL

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation. The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.

*This website is not associated with a broker/dealer and therefore does not advertise, promote, manage, or sell registered investment products that would be done through a broker/dealer or RIA. Any material on this website that references registered investment products is for information only. This website is for educational purpose and is not intended to provide any specific recommendation to anyone specifically.

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