Life Expectancy Underwriters Cause Troublesome Delays for the Life Settlement Market

In an industry that is largely driven by the speed of underwriting, the life settlement sector is seeing a significant increase in average transaction times as life expectancy underwriters increase their turnaround time from an average of two weeks to upwards of six weeks.

There are five major life expectancy underwriters in the life settlement market and this week one of the most widely used of these underwriters informed its clients that it may take as long as six weeks to return the results of their underwriting. For the majority of those participating in the life settlement industry, this is an unacceptable amount of time that will only make the lengthy life settlement transaction process take even longer. Most significantly, since many life settlement transactions involve policy owners selling their policies before their next quarterly premium payments become due, these lengthy underwriting periods will inevitably cause more policies to lapse, more transactions to fail, and more consumers to be harmed.

The solution…

Life expectancy underwriters need to fully leverage technology in order to streamline the underwriting process. Furthermore, underwriters must be ready and willing to hire the qualified staff required to accommodate the growing demand for their services. ISC Services, the newest entrant into the life expectancy marketplace, has grown by 300% over the past year thanks in large part to its average 48 hour turnaround time. “We knew coming into this market that we would need two things to be successful. The first was excellent underwriting standards and the second was speed. By hiring highly qualified staff and operating from an extremely efficient technology platform, we are able to accomplish in two days what now takes our competitors up to 6 weeks to perform. Most importantly, we are able to do this without sacrificing the quality of our underwriting,” commented Morris Fishman, FSA, President and CEO of ISC Services.

Life settlements are a multi-billion dollar market which have moved into the mainstream and have gained the attention of Wall Street. To continue this growth, all participants in the life settlement industry will be required to improve their efficiency and the service that they provide their clients. However, since life expectancies play such a crucial role in the overall process, it is imperative that underwriters continue to feel the pressure from market participants and consumers so that they better address the needs of our marketplace.

Source: Life-Exchange, Inc.