Life expectancy or LE in the general term is a number of years that a person is expected to live to. This is usually calculated at a specific time and typically when someone buys life or health insurance. So how does the LE help in life settlement or viatical?
Well when we discuss life expectancy in terms of life settlement or viaticals it effects how much the policy is worth to the investors and how much the investors will have to pay in premiums before they see return on their investment. Obviously this does have an effect on how much money the policy holder will receive. The combination between the LE and the face value of the policy is what has the greatest affects on the value of that policy to investors.
In the end we can understand that one of the largest factors to pricing a life settlement agreement is life expectancy.
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