HOW MUCH CAN I INVEST?
The minimum investment is $25,000 and can come from cash or retirement accounts such as IRAs (Traditional, Roth, SEP), 401k, 403b, annuity distributions, etc. Majority of investors in life settlements transfer their IRAs into this unique program to further diversify their assets.
WHAT COMPANY WILL HOLD MY IRA?
We use Provident Trust IRA Services, a third party administrator, to act as custodian for our IRA accounts. Upon opening an IRA, you would rollover/ transfer funds from your existing retirement account into the new IRA. Once funds are received, the investment is then placed with your IRA account, which then owns the investment.
WHAT ARE THE RETURNS FROM LIFE SETTLEMENTS?
According to a 2009 Wharton study, participants in life settlements achieved between 9 -13%. Our policy selection process is designed to reach these same potential double digit returns while providing high safety by escrowing an additional one year of premiums beyond the insured’s life expectancy (LE). Please speak to your adviser for more details.
DO YOU PROVIDE DETAILS OF THE MEDICAL HISTORIES?
Yes. Medical histories are summarized in the Policy Menu Sheet and upon request, copies of the Life Expectancy reports can be provided.
I HAVE ANNUITIES. CAN I TRANSFER THEM TO THIS?
Yes. However, surrender charges may apply so please review carefully with your adviser and CPA. If your annuity is in an IRA, you may transfer the annuity to a new IRA at Provident Trust which will hold and invest into the life settlements for you.
ARE THESE THE SAME AS VIATICALS?
No. Viaticals are life insurance policies on insureds that have been diagnosed as terminally ill. Life Settlements are policies that are sold by senior are who 65 years old and over. Our primary criteria in purchasing policies are insureds that are at least 75 years old and with severe impaired medical conditions with life expectancies (LE) of two to five years due to their current medical issues. In fact, most of the policies we acquire are from seniors over 80 years old.
HOW MANY POLICIES CAN I BUY INTO?
The minium investment is $25,000 and we typically have five policies in the portfolio available for clients. The minimum amount that is allocated per policy is $5,000 thus a $25,000 is evenly divided among the five policies at $5,000 each. Larger investments can be diversified according to the investor’s request though we highly encourage proper and proportionate allocation among the policies.
WHAT TYPE OF POLICIES DOES THE PROGRAM BUY?
Our program only acquires Universal Life policies from the highest rated legal reserve U.S. life insurance companies such as Pruco Life, Mass Mutual, Lincoln National, etc.
HOW DOES THE SPONSOR COMPANY MAKE MONEY?
Our sponsor company charges no fees or loads. Simply, their margin is the difference between the amount raised and the amount paid for the policy plus the premium reserves needed in escrow for the insured’s life expectancy (LE) plus one year. For example, assume we purchased a policy with a death benefit of $1,000,000 with a three year life expectancy (LE) for $350,000 and total premiums of $250,000 needed to be escrowed, our total cost would be $600,000. The company would raise $700,000 and realize a margin of $100,000 and give investors a $300,000 profit margin over their investment of $700,000 over the projected LE of three years.
CAN I HAVE THIS UNDER MY COMPANY’S NAME, LIVING TRUST, IRREVOCABLE TRUST, ETC?
As long as the entity in which you want the asset to be owned by has a tax ID number or social security number (in the case of your living trust), you can invest into the program under that entity’s name.
WHAT DOES SUNWEST TRUST PROVIDE?
They provide trustee and escrow services of the investors’ accounts, manage the change of Beneficial Interests of the policies acquired, provide monitoring and maintenance of the premium reserves, and manage the processing and handling of the death benefits.
CAN I CHECK IF THE POLICIES ARE IN FORCE?
Sunwest Trust can provide verification of coverage from the life insurance companies and assures that all premiums are paid through the Premium Reserve Accounts.
HOW DO I RECEIVE MY RETURNS SHOULD A POLICY MATURE?
When a policy matures, Sunwest Trust files a Death Benefit claim to the issuing insurance company. Sunwest Trust receives the death benefits as the legal beneficiary on behalf of the investors and pays each investor their fractional interests as detailed in the ownership certificates that the investor received from Sunwest Trust. The investor then has the option to keep the funds received or reinvest back to the program and acquire new policies for further diversification. To date, our program has already had two early payouts due to the insureds passing away which provided our investors very high returns on part of their investment.
CAN I HAVE BENEFICIARIES FOR MY ACCOUNTS?
Yes. If you have a will or living trust, the investment would transfer to your heirs according to your instructions in those documents. Your beneficiaries would contact Sunwest Trust and re-register the asset to the new owners. Our program also allows direct beneficiaries if you do not have a will or living trust. If the investments is being held in a Provident Trust IRA, then your IRA beneficiary designations will dictate who receives the asset.