August 9, 2011
European Life Settlement Association (ELSA) responds to FTfm article “Longer life eats into returns” by Sara Silver
For immediate release
8th August 2011
European Life Settlement Association (ELSA) responds to FTfm article “Longer
life eats into returns” by Sara Silver
The European Life Settlement Association (ELSA) believes that the article “Longer life
expectancies eat into returns” – published in the Financial Times on Monday 1st August –,
although well-written, did not give a balanced picture of the life settlement industry.
The FTfm reported on two practices of specific but unnamed funds that have resulted in
certain investors realizing lower than anticipated returns from life settlement investments,
the facts of which ELSA does not dispute.
1. While the early life settlement market was unregulated and hence had its share of
questionable participants as does any unregulated market, ELSA does not believe the
practices described are representative of most participants in the life settlement
industry today which has new product structures. Just as important, ELSA believes,
the likelihood of investors being misled can be reduced substantially as regards the
specific practices mentioned in the article, if not eliminated altogether, by adopting
two simple procedures that ELSA supports:
a. Requiring disclosure of the medical underwriting firms used to establish life
expectancies of fund assets, and the historical accuracy of such firms, and
b. Requiring independent valuation of fund assets, as is common with most asset
classes.
By simply focusing on the negative side of the story – and, in the process, attempting to give
the impression of discrediting an entire asset class – the FTfm does its readers a disservice.
Of course there are other risk factors to consider, which ELSA does its best to educate
industry participants on as a matter of its educational promotional activites.
Anna M. Bailey, ELSA Chair, commented: “ELSA has been set up to address these issues and
its continuing work on structural transparency and consumer education needs to be
highlighted. The ELSA Code of Practice establishes standards on matters such as fair dealing, reasonable valuation and use of technology to enable this asset class to become one of the
finest investments in the market today.”
NOTES TO EDITORS
ABOUT ELSA
The European Life Settlement Association (ELSA) was founded in 2009 to set standards for
the European life settlement industry. We represent European funding sources, service
providers and intermediaries in the Life Settlement market who are looking to promote
transparency by providing accurate, authoritative information to retail and institutional
investors, regulatory bodies and the media. Our focus is on the promotion of best practice
and the positive development of the European Life Settlement industry’s reputation
amongst all stakeholders. We encourage fair competition and investor protection within the
European market.
For further information please contact:
Anna M. Bailey
ELSA Chair
E: ABailey@mlflexserv.com
T: +1 240 333 7366
Michael Fugler
ELSA Deputy Chair
E: michael@welcomelife.com
T: +1 917 834 7250
Michael Fasano
ELSA Code of Practice Committee
E: mfasano@fasanoassociates.com
T: +1 202 457 8188
Paul Winner
ELSA Director
E: paul@elsa-sls.org
T: +44 798 4160 102
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