Policy Life promotes traded-life fund in Asia
Traded life policy provider Policy Selection has begun promoting its managed Assured Fund to Hong Kong and Chinese high net worth and institutional investors.
The company does not currently have a sales force based in Asia and has so far used broker networks to promote its products, however, it said it now plans to build a sales force in either Hong or Singapore to support existing relationships and build new ones. Policy Selection also confirmed it would be applying for a licence to sell the fund in Singapore.
Georg Alexandridis, of Policy Selection said: “Our research suggests there is a hunger for this type of asset class in Far Eastern markets and we are keen to meet the demand as soon as possible.
“Hong Kong is now one of the world’s great financial hubs and the phenomenon of the emergent Chinese investment community makes these areas so appealing to jump into.”
Alexandridis added that a number of leading financial institutions in Asia had already invested in the fund and said this was largely due to the consistent nature of the returns the fund is able to generate.
The Assured Fund buys life insurance policies from aging US citizens who wish to benefit from the cash built up in a policy. The fund will purchase the policy directly from its owner at a discount to its maturity face value and will then continue to pay the premiums to the provider, collecting the full cash payout upon the death of the insured’s demise.
The fund targets returns per annum of between 8% and 11%. Last year, however, the fund fell below expectations returning 5.5%. Policy Selection said the shortfall in the return was caused by two main factors: first there were more small policies which matured last year, rather than of average size and second, the company said it was still awaiting the payment of $13m from some life offices. The fund’s annualised return since launches has been 9.07% pa.