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Death Futures

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Frederick The Monk
61186.  Tue Mar 21, 2006 8:13 am Reply with quote

Question: What is the best way to profit from the death of a stranger?

Forfeits: Mug them

Answer: Buy Death Futures.

Notes: Grusome but true, death futures or 'viatical settlements' as they are euphemistically known are traded life policies, involves buying the rights to the life insurance policies of the terminally ill. The seller gets a lump sum and the buyer gets the rights to the sellers life insurance payout when they die. Sounds like a win-win situation until you remember that the buyer is effectively gambling on how long a terminally ill person will live.

Death futures traders analyse medical notes to make predictions about how long the person will survive. The longer they are likely to live, the less they will receive for their life insurance policy.

For example, someone with three years to live might receive 70 per cent of the value of a policy. But if he or she had only months to go, you would have to pay more than 90 per cent of the payout value.

There are a few financial advisers in the UK who offer access to traded life policies through offshore funds. Shepherds, the traded endowment policy (Tep) specialist, has an Experienced Investor Fund, which invests in both Teps and traded life policies. David Silverman & Co, an independent adviser in Altrincham, Cheshire, also offers a traded life fund which gives returns of 9 per cent or more, with no risk to capital.

Definition:††
a term for a life insurance policy of a terminally ill person that is bought by a third party as an investment, which gives financial benefits to the ill person while alive and the investor upon the death; also called viatical investment

Links to: Death

Sources:
http://hanson.gmu.edu/PAM/press2/TimesLondon-8-2-03.txt
http://asc.state.al.us/News/2.26.2Risky%20Death%20Futures.htm
http://dictionary.reference.com/search?q=death+futures
http://en.wikipedia.org/wiki/Viatical
http://www.sec.gov/answers/viaticalsettle.htm

Pictures/Props:

Researcher: JP

 
eggshaped
63653.  Tue Apr 04, 2006 9:01 am Reply with quote

Here's that guy who put a bet on his own life.

Quote:
A 91-year-old British man who staked a 500-pound bet that he would be dead by the end of the first week in December lost his stake by staying alive, a bookmaker said Saturday.

Arthur King-Robinson said he put the bet on at odds of 6/1 at the start of the year because his wife would have faced an inheritance tax bill of 3000 pounds had he died in the intervening period.


http://www.msnbc.msn.com/id/10453903/

 
Flash
63658.  Tue Apr 04, 2006 9:11 am Reply with quote

A good idea, and indistinguishable from life insurance except that there isn't some bastard taking a fat commission for selling it to you. I always thought it was illegal, though.

 
MatC
66585.  Fri Apr 21, 2006 11:31 am Reply with quote

The Treasury has introduced a dispensation to allow members of certain religions, notably the Plymouth Brethren, to avoid buying annuities, because members of these religions find it unethical to profit from another personís death through cross-subsidy. They can opt for an ďalternatively secured pension (ASP),Ē but to prevent people who donít have religious objections getting ASPs, insurance companies may be required to ask people their religion.
- Sunday Telegraph 16 April 2006

 

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