Executive Summary:                              The 3rd wave of the pandemic was the most widespread and deadly.  Through 2020, we did not find evidence of protection on Life Settlement lives from COVID.  However, in January 2021, at the peak of the 3rd wave, we saw the first signs that vaccines may be reducing excess mortality in Life Settlements.  Many Life Settlement lives are in the highest priority cohorts for the vaccines and will li ..read more

In our last two blogs, we discussed when and how to sell a life insurance policy.  In this blog entry, we want to talk about the taxation of a life insurance policy sale for the seller. The death benefit of a life insurance held in trust is received free of both estate and income taxes, however, if a TOLI life insurance policy is sold, taxes may be due. The taxation of a life insurance policy is similar to, but not as simple as, a policy surrender for cash value, though the Tax Cuts and Jobs Act – did simplify the process. Calculating the Taxation of a Life Settlement: A Three-Step Proce ..read more

In our last blog, we tackled the question of when to sell a life insurance policy.  With past and potential future changes in the estate tax laws and the aging of the population in the typical TOLI portfolio, life settlements will become more prominent in the coming years. The TOLI trustee must become aware of the sales process, so we wanted to provide a short primer for trustees who need a better understanding of this valuable policy option. A typical procedure can be broken down into six steps: Initial Inquiry and Appraisal: If a life settlement is contemplated, the viability of ..read more

It is estimated that over 100 billion dollars in life insurance benefits are surrendered each year by older aged citizens in the US. (1)  Unfortunately, the typical senior probably does not understand the life settlement market and the opportunity to maximize the value of an asset that many let lapse valueless after a lifetime of premium payments. Today’s TOLI trustee needs to be aware.  With the changes in the estate tax laws and the aging of the TOLI population, the opportunity to obtain maximum value for a TOLI policy may hinge on a TOLI trustee’s understanding of the life settlem ..read more