What You Should Know About Life Settlements | FINRA.org

"What's the best price I can get for my policy? If you’re using a life settlement broker, ask what bids were received and what steps the broker took to make sure you’re being offered the most competitive price available. If you’re approached by someone soliciting you to sell your life insurance policy, understand that person's role in the transaction: Are they a life settlement broker who represents you, or are they affiliated with a particular life settlement company? If the answer is the latter, the person might only obtain an offer from that company, making it hard for you to know whether you’re being offered a competitive price."

July 31, 2023

5 Critical Questions:

Determine if a Life Settlement Resource Passes the Compliance Test

Compliance officers have come to recognize that if life settlements are pursued for the right reasons, after a thorough review of all non-forfeiture options and suitability, a life settlement could very well be in clients' best interests. It is a viable exit strategy that should be disclosed in a comprehensive policy review in partnership with a resource that offers a compliance-centric process. However, broker-dealers do not just allow life settlements carte blanche. They put strict procedural guardrails in place to protect the company and their representatives from liability risk. 

1. Are they licensed to represent the buyer (investor) or the seller (policy owner)?
2. Do they hold a life settlement broker's license in all states that require them? 
3. How do they protect the best interests of the policy owner/seller during the life settlement process? 
4. Do they offer life settlements as their core business or only as a supplement to their overall business offerings?
5. Do they conduct a transparent policy auction between all licensed buyers to obtain the best value for your client?

Life settlements are highly regulated and available to policy owners in all 50 states

Ashar Group is an industry leader in compliance. We believe planning professionals need to be confident that they are associated with a partner who is fully aware of the complexities the financial community faces today - both legally and ethically.