We have represented clients in a variety of business issues and lawsuits.  Our objective is always to resolve business issues and disputes promptly and efficiently.

We represent elderly persons, who have purchased life insurance policies with non-recourse premium financing, when it comes time to sell policies in the life settlement market. Opportunistic lenders have induced many senior citizens to buy life insurance policies they otherwise had not considered, offering them part of the profit when the policy is sold after two years. South Florida has seen a spectacular growth in the sale of non-recourse premium financed life insurance policies to seniors. It is part of a trend fostered by the new life settlement industry, which began with viatical policies. It arose because a mature life insurance policy (more than two years old) has a value to investors much greater than policy cash value, especially if the insured is quite elderly. Many people don’t mind a stranger owning an insurance policy on their lives (it is often called stranger originated life insurance, SOLI or STOLI), even though the stranger is waiting for them to die. There is money to be made since life insurance companies can afford to “under-price” life insurance policies, on a strictly actuarial basis, since so many policies are cancelled after a few years without any death benefit being paid.

In one case, a $4.4 million life insurance policy sold in the life settlement market, yielded a profit, after paying off the loan, of nearly $400,000. Another $5 million policy shows a profit of $500,000. The rub comes when it is time to sell the policy. Who gets the profit? Lenders charge large back-end fees and coax seniors to just surrender their policies to satisfy the loans. This can lead to adverse tax consequences. Florida regulates these transactions. We represent seniors when lenders try to take an unreasonable “return” on their loans.

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April 2008