Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Monday, November 26, 2007

Growth Industry in Life Markets

The Wall St. Journal focuses on the "life settlement" business, where companies pay a lump sum to the insureds in exchange for the death benefits under life insurance policies.   This is a growth industry that is an expansion of the viatical settlements that were offered to AIDs patients and that the D.C. Circuit held, in 1996, were not securities in SEC v. Life Partners Inc. Major investment firms like Goldman Sachs, Credit Suisse and Bear Stearns are in the business as the market looks for returns that are unrelated to the capital markets.  The firms have formed a trade association, Institutional Life Markets Association, to lobby against efforts to restrict the business.  WSJ, An Insurance Man Builds A Lively Business in Death.

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