MOSS POINT’S APPROACH
Understanding the Life Settlements Model
Modeling life settlements is a very straight forward calculation.
Nearly all of the variables are known — the total purchase price, the amount received upon maturity, & the discount factor.
The only variable that remains… is time.
The most successful investors in the asset class, are the ones that can most accurately predict time.
Big Data & Reversion to the Mean
Most investment managers in the [Tertiary Market] space, purchase policies held by senior citizens & rely heavily on actuarial data of life expectancy to make investment decisions.
The approach profits, by capturing a small statistical-edge from a large pool-of-activity, over an extended period of time.
It’s a business model employed in all sorts of industries — from casinos, to insurance companies, to quantitative investment management…
While it’s a sound approach — it’s very different than the Moss Point approach. In our experience, it’s also much less profitable.
Our Non-Traditional Approach
Key Differentiator # 1:
Life Expectancy Modeling
We have invested heavily in our “MPF Maturity Model” to predict life expectancy of individual policies with greater accuracy than what can be achieved using industry-standard actuarial data.
Actuarial data is very accurate, but can also be riddled with assumptions – classifying individual conditions very broadly.
