Aviex creates notes backed by pools of life insurance policies. These notes are customized for institutional clients.
Aviex, and its principals, a New York based financial advisory firm began its study of using life insurance as an asset class in July 2000, and in 2008, commercially launched proprietary products that use life insurance policies in custom pools. Since then Aviex has reviewed, priced and successfully bid on several billion dollars worth of face value of life insurance policy portfolios.
The policies are assembled by Aviex into custom pools on behalf of “A” rated customers that purchase multiple pools over time.
The policy pools are designed to be self financed after the initial pool purchase with policy maturations paying all premiums and costs.
Aviex has spent eight years and nearly $6 million studying the life insurance market place, defining an institutional asset class, perfecting the legal and economic platform, creating sophisticated computer modeling capability to match assets to investor requirements using over 250 different data points, studying longevity and its impact on mortality and pool performance, analyzing lifestyle attributes and their effect on longevity, and thus not relying solely on traditional industry measures such as manufactured Life Expectancies (LE‟s), which improves Aviex’s statistical ability to match, or exceed mortality rate schedules by proper policyholder selection.
The purchase price of a policy is determined based on the probability weighted present value of the cash flows (premium and death benefit) using the investor’s ROI target. The probabilities are based on mortality tables derived from the life expectancy of the insured. Other considerations, such as legal and regulatory risk, are also evaluated and factored in on an individual policy and a portfolio basis.
Aviex then applies its proprietary analysis to select policies to maximize returns.
Portfolios are valued based on the aggregation of individual policy prices and the impact of additional factors including, but not limited to, carrier distribution, impairment exposure, geographical diversity, male/female ratio, policy classes, origination and documentation quality.
Aviex purchases policies from large institutional investors, in order to construct its pools.
Over the last 3 years Aviex Group has reviewed, analyzed and structured in excess of $2 billion of portfolios for clients.