Insurance

A major player in the life settlement market has filed for Chapter 11 bankruptcy protection. On Monday, J.G. Wentworth and two of its affiliates filed for bankruptcy protection in a Delaware court. J.G. Wentworth had been very active in the life settlement market. The financial crisis has deeply impacted all securitization markets, and the life insurance market is no different. Life insurance policyholders who have already sold their life or annuity policies and received funds should be fine...

Rating agency A.M. Best has recently issued a report indicating that three insurance companies have become financially impaired thus far in 2009. A.M. Best considers an insurance company impaired once a state department of insurance has taken its first official regulatory action against the company. The three carriers considered impaired are: Shenandoah Life Insurance Company American Network Insurance Company Penn Treaty Network America Insurance Company A.M. Best indicated that more impaired...

An annuity ladder basically involves spreading annuity purchases over time. For example, instead of taking $100,000 to purchase an immediate annuity today, a person might purchase five different $20,000 annuities over a seven year period. This approach has a number of advantages: The approach helps avoid the risk of purchasing an annuity at a less then optimal time--for example when interest rates are very low. In this sense, it is somewhat similar to dollar cost averaging when investing . The...