Corry Capital’s General Manager: State Regulators Help Boost Life Settlements
February 18, 2017 by Meg Green
NEW YORK – William Corry, general partner, Corry Capital, said several larger U.S. states have been active in educating consumers and agents about opportunities to sell life policies into the secondary market. Corry spoke with A.M. BestTV at the Life Insurance Settlement Association’s annual Institutional Investor Conference in New York.
View the video version of this interview at: http://www.ambest.com/v.asp?v=corry217
Following is an edited transcript of the interview.
Q: Where do you see capital flowing into the market?
A: We see it mostly from institutional investors such as, in our case, we’ve been now doing this since 2008. We have a multitude of pension plans, government, Taft-Hartley pension plans, as well as family offices, endowments, foundations, mostly institutional capital that we’ve seen flowing into the market.
Q: Do you think it’s an appropriate investment for the retail market?
A: I don’t. I’m not big on the retail investor being involved in life settlement, only because of the complexity involved with the asset class. We chose early on to work with institutional investors. I think it’s more appropriate, especially on the pension side because they have consulting firms that can vet, do the due diligence on behalf of the pension firm to make the investment.
Retail investors I don’t think have the access to the information necessary or the expertise on the actuarial side necessary to consider it. Retail is an interesting word or terminology because I consider a retail investor even somebody that might have $1 million to invest. They could still be a retail investor depending on their net worth and their expertise, even in the financial world.
I don’t think any investment under $1 million should be in the life settlement business. That’s my own opinion but definitely I think it’s more appropriate for institutional investors.
Q: What opportunities are you seeing in the market today?
A: The market for us, we just raised a new fund. From the investment perspective I think there’s plenty of opportunities for large family offices and again, institutional investment both here in the U.S. as well as overseas. We have funds in the U.S. and we have funds offshore. Luxembourg-based funds. There’s a lot of opportunity with non-resident U.S. investors for those types of funds. From a policy supply perspective, we see more supply in the market today than we did three or four years ago. I feel confident that that’s a trend that will continue.
Q: How has the market evolved over the years for the consumer?
A: For the consumer, the consumer selling the policy. I’m assuming that’s what you mean. For the consumers selling it’s become a more efficient market. There’s more institutional capital. The brokerage community has become more educated in the way that they shop the policy for the consumer. Life insurance agents are better educated at life settlement as well.
The states, it’s hard to put all 50 states into one category but a lot of the larger states have done a great job for a consumer, the right perspective in educating the consumers through their insurance agents. States like California, here in New York, have done a phenomenal job.
That education has then gotten the consumer to a point where they truly understand, or maybe they’re starting to understand, the exit strategy that life settlement gives them.
Q: How do you see the market evolving going forward?
A: On a go-forward basis, it gets better for the consumer. There are more consumer rights, more regulation for the consumer. I view that as a good thing. It helps them become more educated. With the baby boomers, especially, continuing to age and buy more insurance. Insurance goes in cycles. People buy it when they’re young. They get rid of it in the middle. Then they buy it again when they get older. Knowing you have an exit strategy is a good thing for a consumer.
For the investor, there’s much more data available from returns and how life expectancies have evolved and performed over the years. From both a consumer and an investor perspective, the industry becomes more efficient and more acceptable on a go-forward basis.
View this and other interviews at http://www.ambest.tv
(By Meg Green, senior associate editor, A.M. BestTV: Meg.Green@ambest.com)
