About the Amrita Life Settlement Index

The Amrita Life Settlement Index (ALSI) is an indicator designed to measure life settlement industry demand, which is defined as the degree of buying activity expressed through life settlement provider activities and attitudes. The Index is calculated each month, based upon the Amrita Life Settlement Provider Survey responses which are collected from numerous life settlement providers licensed and active in the United States life settlement industry. As buying agents in the life settlement market, life settlement providers are polled about current life settlement market conditions and future expectations for the demand of individual life insurance policies on the secondary life insurance market (life settlement market). Much like other indices such as the Consumer Confidence Index (CCI), the ALSI is a relative comparison that illustrates trends from one month to another.

Amrita Life Settlement Index - Life Settlement Industry Barometer

Life settlements are a unique asset class due to the relatively small number of buyers that represent the demand side of the life settlement industry’s supply vs. demand equation. Valuable life settlement insights are captured by ALSI because it measures the current sentiment and activity of the life settlement industry’s buyers. Buying agents in aggregate represent not only the current posture of the life settlement market, but also give insight into the future prospects for growth or contraction.

Essentially, increased buyer activity indicates more capital entering the life settlement market, expanding its size. While decreasing life settlement provider activity and confidence imply a slowing or contraction in the overall life settlement industry. Consequently, overall aggregated positive responses to the survey and increased buyer sentiment are expressed as gains in the ALSI, while weakening life settlement provider sentiment appear as a decline in the index.

Amrita Life Settlement Provider Survey - Life Settlement Insights

Each month Amrita Financial surveys a number of licensed life settlement providers operating in the United States. Opinions on current activities and life settlement market conditions make up 85.71% of the index, while expectations of future buying demand comprise the remaining 14.29%. The Amrita Life Settlement Index was developed in 2009, with December 2009 as the benchmark equaling 500.

The survey consists of seven questions that ask the respondents' opinions about the following:

  • Changes in life settlement buying activity
  • Amount of individual life insurance policies that are being presented for sale by consumers, life settlement brokers and other sources
  • Amount of life insurance policies that have been purchased
  • Policy buying parameters
  • Target rates of return for the life settlement investments
  • Outlook for upcoming buying activity

Survey participants are asked to answer each question as "positive", "negative" or "neutral". The results from the Amrita Life Settlement Provider Survey are aggregated, averaged and converted into a monthly data point for the Amrita Life Settlement Index, which is released on the first Tuesday of each month at 10am EST.