METHOD AND SYSTEM FOR LIFE SETTLEMENT AND LIFE INSURANCE CONTRACTS SECURITIZATION INVOLVING ASSET AND LIABILITY STRIPPING

摘要

A method for creating a special purpose entity of high credit quality with an initial amount of investment capital, comprising the steps of: acquiring an initial amount of capital; using this investment capital to acquire a plurality of life insurance policies by executing life settlement contracts; appointing a trustee to administer the acquired life insurance policies by paying ongoing premium obligations and receiving policy benefits; performing a valuation of the underlying life insurance policies; stripping the death benefit assets from the policies and transferring or assigning them to vehicle; stripping the premium obligations from the policy and transferring or assigning them to a bankruptcy remote vehicle for consideration; transferring or assigning the premium obligations to a reinsurance company or reinsurance captive entity; paying the reinsurance company or reinsurance captive entity to assume to the premium obligations; creating a plurality of senior class securities such that cash flows for the senior class of securities are received on or before a stated date with high statistical confidence; and creating a plurality of less senior classes of securities with cash flows that are received with a lower statistical confidence.