Don’t let the title of this post scare you, this is basically from the article by David Stevenson regarding different fund types including life settlements.

Here is his paragraph on Life Settlements:

Life settlement funds – and not just Keydata’s. Virtually every investment in life insurance policies aimed at private investors fills me with fear. How do we know the provenance of the demographic models and how changes in longevity will affect return profiles? Maybe this is a new alternative investment groping towards respectability – but it’s not going to do so with my money!

Of course, David does leave out a lot of information and is pretty quick to judge the investment model without providing many factual details. Longevity is an industry effect that all funds could potentially be effected bye now. Stricter underwriting will help correct this.