Wall Street Turned AIDS-Era Life Policy Deals Into a Multi-Billion Dollar Market
Updated
Updated · NPR · Aug 14
Wall Street Turned AIDS-Era Life Policy Deals Into a Multi-Billion Dollar Market
3 articles · Updated · NPR · Aug 14
Summary
Wall Street firms now profit from a multi-billion dollar secondary market in life insurance, buying policies from holders and collecting the death benefit when they die.
That market grew out of the AIDS crisis, when seriously ill people used policy sales as a desperate way to get cash before death instead of leaving the payout to beneficiaries.
In a typical deal, the policyholder receives money upfront, the investor takes over premiums, and the eventual insurance payout shifts from family members to the buyer.
What began as an emergency financial workaround has since been absorbed into mainstream finance, with major firms treating strangers' life expectancies as an investable asset.