Policy Statement: Fractionalized Interests

The mission of the Life Insurance Settlement Association (LISA) is to advance the highest standards of practice and professional development for the industry, and to educate consumers and advisors about a life settlement as an alternative to lapse or surrender of a life insurance policy.  LISA strongly supports the secondary market for life insurance as the source of an asset class that provides investors with excellent non-correlated returns.

Since its founding, LISA members have expressed concerns about the fractionalization and selling of multiple interests in the ownership of a life insurance policy because it creates an investment structure with unique and complex risks that are not easily understood by most investors. In addition, investment offerings of fractionalized interests in life insurance policies may be inconsistent with respect to representations about the safety and performance of such investments, and/or may fail to adequately disclose all of the risks associated with these investments.

Accordingly, LISA reaffirms its position that the purchase of fractionalized interests in a single life insurance policy is an inappropriate investment for most if not all investors. LISA advises that any party considering an investment in a fractionalized interest in a life insurance policy should have financial and legal professionals carefully review both the terms of the offering and its sponsor in order to make a fully informed investment decision.

April 30, 2014

Stay Informed of Industry News

Latest Blogs

10/13/2021

Combating Inflation with Life Settlement Earnings

Everything is getting more expensive these days. Gas prices are higher, food prices are higher, used car prices are higher—it seems like nothing right now…

Read More
10/06/2021

How Did Insurance Policy Owners Earn $848 Million in 2020?

It’s true—according to “The Life Settlements Report” released by The Deal, 3,241 people sold their life insurance policies in 2020 for a combined total of…

Read More
07/20/2021

Working With Life Settlement Professionals

Read More
06/09/2021

How to Help Your Client Choose a Life Settlement Provider

Many life insurance policy owners may wonder where to start when pursuing a life settlement provider. Selling a life insurance policy is an important decision…

Read More