The latest moves and appointments in the Asia-Pacific wealth management industry.
Laureola Advisors, a life settlements fund manager, has opened an office in Sydney and appointed Nathan Wares to its lead distribution efforts. The firm, which is based in the British Virgin Islands with offices in several locations such as Canada, the UK and US, made a “soft” launch of its Australian business about two years ago.
Wares has more than 25 years’ experience in funds management, investment banking, financial markets and private banking. In the past 20 years he has served in senior roles both in a leadership and sales capacity at Citigroup Asset Management as vice president of sales, ANZ Investment Bank as director of equity capital markets, and a director of Westpac and St George Private Banks managing people and UHNW client portfolios.
Life settlements involve selling a life insurance policy to a third party. The buyer, who takes over ownership of the policy, takes over the premium payments in exchange for the death benefit when the insured dies. US legal rulings have allowed life policies to be traded with the same ease as bonds or stocks. In the 1980s, the market was stimulated by AIDS victims cashing out policies early. As the market developed it drew controversy and the kind of tags that might give pause, such as a “morbid niche” (US News, August 2017), but awareness of its benefits have grown. As many people allow their policies to lapse rather than claim back some of their premiums, defenders of the market say they are doing millions of financial consumers a favour.
According to Laureola Advisors, life settlement funds pay policy holders three or four times the amount offered by the issuing life company to surrender the policy.
This news service reported in 2020 that the total life insurance market is about $20 trillion in face value.
With life settlements, managers must accurately measure mortality rates. If mortality is misjudged – people live longer than expected – then returns to those buying life policies will be squeezed.