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Why Financial Advisors Owe It to Their Clients to Go Through a Life Settlement Broker


January 19,16 | 11:35 am

In this day of instant information and overwhelming choice, it’s tempting to go straight to the source for things. Instead of shopping retail, people go online to buy wholesale, for example.

That method can have its benefits, when you’re dealing with something as simple as price. But as financial advisors know well, when you’re working with complex financial transactions, skipping the intermediary can mean missing out on vital, valuable information. Your clients know this, or they wouldn’t be your clients.

So why would you go through something as potentially complex and important to your client as a life settlement without a broker?

At Ashar, we work with financial advisors all the time to get the best possible offer for their clients’ life insurance policies. It’s what we do – we’re pros at it. Over the years, we’ve seen many illustrations of the reasons why financial advisors should always go through a life settlement broker when managing this transaction.

Investors always have a representative. You and your client should too.

In a life settlement transaction a middleman administrator, called a provider, represents the buyers/investors. Some buyers are also licensed as providers. In both cases, their fiduciary responsibility is to the investors they’re representing – the provider’s job is to secure for those investors the lowest possible price for the policy they’re purchasing.

In other words, they want to purchase your client’s policy at as deep of a discount as they can get away with.  That’s why you and your client need the knowledgeable representation of a broker who is capable of creating a bidding war to get offers as much as 800 percent higher. 

A life settlement is a specialized area of finance that requires specialized knowledge.

There’s a reason life settlement brokers exist: there’s a lot to know about this area of expertise. There’s so much, in fact, that it keeps us and our 20 person team busy full-time. No financial advisor could be expected to have all the information necessary to negotiate the best possible deal for his or her client.

We’ve been in this business for a long time, and we pride ourselves on continuous learning. So we have both the historical context of the life settlement business to draw on, as well as the latest, most current knowledge.

At Ashar, we also have our proprietary tool the Secondary Market Valuation, or the SMV®. This five-step policy analysis can provide financial advisors with clear, concise insight into the policy’s fair market value. This can be an invaluable factor in a life settlement negotiation, as well as in other situations like a policy transfer, partner disputes, or business valuations.

Armed with the information gained from the SMV®, we can go into a negotiation highly prepared to achieve the best possible results for your client.

Here’s an example: Let’s say you have a $1.5 million policy that your client wants to unload, as he or she no longer needs the life insurance. Without the representation of Ashar you might get an offer of $150,000. You may even be told that this is a “fair offer” and also be led to believe that they went to multiple funding sources when they didn’t. 

When you take the exact same case to Ashar, we create a bidding war that extracts an offer that represents the fair market value of the policy, equaling $800,000. As a financial advisor you understand the importance of fair market value, so don’t be fooled by marketing and a play on words. 

Because of the nature of a life settlement transaction, it’s important that financial advisors who want the best for their clients go through a life settlement broker.  If you’re interested in working with Ashar on a life settlement, contact us! If you’re unsure whether your client’s policy will qualify for a life settlement, you can start the process by taking our simple Policy Quiz.

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