Due Diligence Services
It is important to understand that modeled valuation is not the only factor that affects the purchase/sale price of a policy in the life settlement market. The "quality" of the policy and the "quality" of the specific purchase process (including documentation and discipline) is also, and in some cases, more important than the actual policy valuation. At a minimum, the quality of a policy complements the valuation and has a major impact on the market price of a policy, whether analyzing for internal purposes or for a potential purchase/sale transaction.
Through expertise gained in its affiliated life settlement provider business, Q Capital has tremendous experience reviewing policy documents, the facts around policy sales, and the legality and regulations surrounding such sales. In particular, the initial life settlement transaction must be carefully reviewed so as to ensure that the current and/or prospective future owner does not face any adverse claims (from the insured's family or regulator) when ultimately trying to collect on a policy. In particular, Q Capital has expertise in reviewing policy document packages for the contents (completeness, accuracy, correct set of documents, etc.) and looking for STOLI transactions. Q Capital's due diligence services include a full review of anti-fraud and regulatory compliance matters.
Q Capital will provide a risk assessment on policy files so as to allow its clients the ability to determine whether an individual policy within a portfolio (or individually) meets its criteria. Q Capital can also advise on steps that can be taken to improve the fact pattern and perhaps improve the quality of a case file even after the original transaction was completed.