Tertiary Services

Investors who buy or sell Tertiary Portfolios of life insurance polices confront special issues.  Risks can be difficult to quantify for investors due to the technical issues related to life insurance policies and the life expectancies of insured persons.  On the other hand, the Tertiary Portfolio Marketplace allows only a limited time to make a preliminary offer.  The amount of outside expenses permissible at any point in the portfolio life cycle depends on the investors individual strategic choices in how they balance cost, risk, and agility in their businesses.

If you are an Investor involved in the Tertiary Portfolio Marketplace, ValueLifeCorp intends to improve the options for managing your Tertiary Portfolio opportunities.  First, you get access to independent third party consultants with complementary skill sets — experts who specifically understand the appropriate best practice methods to value life insurance portfolios.

And of equal importance, TPA partners will effectively navigate your Life Expectancy data and advise you how to manage the issues identified.  We augment your team by providing expert assessment of mortality data, including, where applicable, the creation of customized mortality curves reflecting the risk profile of each case in your portfolio.  Our mastery of your Life Expectancy issues is a critical competency that helps to assure profitable outcomes in the Tertiary Portfolio Marketplace.

You cannot get all this anywhere else.

The VLC™ Tertiary Portfolio Advisors provide services applicable at various times throughout the life cycle of a portfolio.  Any of our advisors can assist you with your needs in Portfolio Acquisition, Financial Reporting and Mark to Market, Active Management Decisions to Restructure, and Portfolio Disposition. We can provide all the Actuarial detail in MS^®Excel^® extracts with reusable data formats.

Anna R. Hart, MS, SRM

Richard L. Bergstrom, FSA, MAAA

R. Larry Warnock, FSA, MAAA

As an Investor in the Tertiary Portfolio Market, you need to hold your preliminary investigation costs to a minimal level until your bid is accepted for additional due diligence review.  In response to your special problems in the Preliminary Phase, the TPA partners can assist with preliminary valuation and/or full valuation once your preliminary bid has been accepted.  Each service is described below.

We do all the work using tools we create with your job in mind.  We use the policy information that you provide in MS^®Excel^® files, including optimized premium schedules.

We perform no independent verification of the information you provide; we only review the provided life expectancy information to identify inconsistencies.  We will flag any data items with obvious flaws and work with you to identify cases requiring independent LE review.  For selected cases, we will perform an underwriting analysis and develop LEs and a mortality runoff table.  Our valuation process utilizes the mortality runoff tables that we create if we review your LE data, or if not we will backsolve the mortality curve from the LE data provided.

The Valuation Reports include a detailed report set for each policy in an MS^®Excel^® file.  You provide three discount rates to establish the valuation range.  We provide a separate valuation range for each underwriter used, and one for blended values.

Once the preliminary bid is accepted, and further due diligence is pursued, you need to get the best information and documentation possible.  ValueLifeCorp and the VLC™ Tertiary Portfolio Advisors offer a complete portfolio valuation service for opportunities at this critical point.

Our valuation output will include a detailed excel-based valuation report for each policy.

The bidding investor will be provided with additional data, such as carrier illustrations of projected values and premiums, verifications of coverage, policies, life expectancy certificates, and medical records.

The valuation should be enhanced to independently verify the minimum premium calculations, rather than just relying on the seller’s calculations.  This requires additional data to be entered.

If the life expectancy review was either not performed for the preliminary valuation, or was limited, this process can now be completed by Hart/Bergstrom for each case, or for a portfolio sample (your option).

The participation of Hart and Bergstrom can greatly enhance the reliability of the valuation process as a whole regardless of the option you choose.  The review and interpretation of life expectancy information remains a high-touch service that requires substantial professional expertise.  You may choose to engage Hart and/or Bergstrom to review your life expectancy data for inconsistencies, and to assist in identifying cases where independent LE reviews are warranted.  The VLC™ Tertiary Portfolio Advisors can perform underwriting analysis for all cases you select.

After closing on the portfolio acquisition, you must consider how to provide on-going periodic portfolio valuations required by your financial reporting processes.  There is a host of issues to consider, many of which often are considered as part of the due diligence process.  Here are some considerations:

ValueLifeCorp and the TPA partners offer support options for Investors throughout the Tertiary Portfolio life cycle.  For more information, contact ValueLifeCorp or one of the advisors above.