Life Settlement Industry Poised for Growth as Financed Policies Hit Market; Welcome Funds CEO Advises Policyholders to Shop for

The life settlement industry is poised for another major growth spurt in the latter half of 2006 as many non-recourse premium financing contracts enter the secondary market, according to life settlement broker John Welcom of Welcome Funds. Life settlements enable seniors to sell existing life insurance policies for sums that exceed their cash surrender values.

Non-recourse premium financing has enabled many seniors to receive substantial life insurance policies at virtually no cost. The complex transactions, which are coordinated by life insurance agents and financing companies that loan premium funds to seniors, typically have a two year term and provide the senior with the option of paying off the loan, selling the policy to the life settlement market, or walking away from the loan without recourse.

“Non-recourse premium financing began to take off in late 2004 and experienced explosive growth through 2005,” said Welcom. “Policies purchased by seniors two years ago are already starting to flood the market, but some policyholders are missing out on opportunities to maximize their payouts.”

According to Welcom, many seniors who own these types of policies are not aware of their rights and options when the time comes to repay the loan for the premium payments. Policyholders should understand that they can repay the loan plus interest and fees in order to retain the policy. Working with an independent life settlement broker is the best way to maximize settlement offers, for both policyholders and agents alike.

Most of the individuals who choose to sell their premium-financed policies often rely on their insurance agent or advisor who orchestrated the deal to find a life settlement provider, but that can have drawbacks.

“A recent national study revealed that only eight percent of financial advisors and insurance agents solicit settlement offers for their clients’ policies from four or more life settlement providers,” said Welcom. “Unfortunately for policyholders, this means that the vast majority of policies are being improperly shopped since there are approximately 30 qualified
institutional settlement providers operating today.”

Since most settlements are being negotiated with only three buyers or less, more than 90 percent of the secondary marketplace is typically not being given the opportunity to consider a policy and provide an offer.

Welcome recommends that anyone advising seniors, who are holding non-recourse premium financing life insurance policies, to speak with an experienced life settlement broker when the time comes to sell. Brokers should be judged on their life settlement industry experience, internal negotiation practices, existing relationships with institutional providers, appropriate licenses, and adequate Errors & Omissions coverage. Complete and exhaustive market coverage is the only method to ensure that clients receive a fair and competitive settlement for their policy.

Welcome Funds Inc. is a licensed life settlement broker based in Boca Raton, Fla. Operating since 2000, the company negotiates with licensed funding providers to obtain the absolute highest settlement offers available for each and every client. The company is a member of the Life Insurance Settlement Association and various other professional and civic organizations. To learn more about Welcome Funds or life settlements, http://www.welcomefunds.com, call toll-free at 1-877-227-4484 or .(JavaScript must be enabled to view this email address).