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Gwg Holdings Inc's Business Segments
Gwg Holdings Inc's reported revenue by business segment and by geographic region, quarterly and annual, normalized against the consolidated income statement. Free below: the top 3 rows per table, this quarter and this fiscal year. Subscriber access adds the full segment history and operating income by segment.
Segment Data As of Q3 FY2021
Reportable Segments
3
Largest Segment
Beneficient
Total Revenue
$ 34
Regions Reported
-
Revenue Share by Reportable Segment - Q3 FY2021
- Beneficient52.9%
- Secondary Life Insurance46.9%
- Corporate and Unallocated0.2%
Revenue by Reportable Segment - Q3 FY2021
| Segment | Revenue (Millions) | % of Total |
|---|---|---|
| Beneficient | $ 18 | 52.9% |
| Secondary Life Insurance | $ 16 | 46.9% |
| Corporate and Unallocated | $ 0 | 0.2% |
Description of Gwg Holdings Inc
GWG Holdings, Inc. is a specialty finance company and a leading financial purchaser
of life insurance assets in the secondary market. We create opportunities for
consumers owning life insurance to obtain significant value for their policies
as compared to the traditional options offered by insurance companies. We also
create opportunities for investors to participate in alternative asset classes,
such as life insurance, not correlated to traditional financial markets.
Overview of GWG Holdings Inc.
GWG Holdings Inc. operates in the sector of life insurance finance, specializing in the purchasing and management of life insurance assets in both primary and secondary markets. Their primary focus revolves around acquiring life insurance policies from policy owners, facilitating a unique investment avenue that contrasts with traditional asset categories.
Segments and Product Offerings
1. Life Insurance Asset Acquisition:
- Primary Market Purchases: GWG acquires life insurance assets directly from policyholders who have purchased life insurance policies.
- Secondary Market Transactions: The company traditionally sourced policies from a network of specialized brokers who assist in connecting sellers with buyers interested in the secondary market.
2. Appointed Agent Program:
- This program engages financial professionals, including financial advisors and life insurance agents, to educate them about the life insurance secondary market and empower them to bring this markets value to their clientele. The program comprises:
- Education and Training: Providing resources to ensure that agents understand the intricacies of life insurance assets.
- Regulatory Compliance Support: Ensuring that agents are knowledgeable about the legal aspects surrounding life insurance transactions.
- Marketing Assistance: Offering marketing materials and support to help agents promote GWG’s offerings.
3. Underwriting and Valuation Services:
- GWG emphasizes the acquisition of high-quality life insurance assets through rigorous underwriting practices. Key components include:
- Life Expectancy Assessment: Utilizing independent medical-actuarial firms to estimate the life expectancy of insured individuals. The average of two life expectancies is typically used to assess and value policies.
- Innovative Practices: The company is committed to improving the efficiency and accuracy of its underwriting processes, particularly for small face policies (typically under $1 million).
4. Operational Efficiency Enhancements:
- GWG has made significant strides in reducing the timeframe required for preliminary underwriting assessments. The timeline has been cut down from several weeks to just days, enhancing competitiveness in market development.
- Continuous refinement of underwriting protocols is a priority, incorporating multivariate analysis and advanced testing methodologies to improve mortality predictions.
Risk Management and Value Proposition
1. Financial Performance:
- GWG generates profits by capturing the spread between the purchase cost of life insurance policies and the face value of the benefits received from these policies upon maturity. This model hinges on maintaining premium payments on acquired policies.
2. Risk Mitigation Strategies:
- Longevity Risk: The firm actively manages longevity risk by leveraging data analysis to enhance mortality predictions. It utilizes both traditional actuarial methods and novel data approaches, including socio-economic and medical testing variables.
- Credit Risk Management: Assessing the creditworthiness of insurance companies that underwrite the purchased life insurance policies is critical to safeguarding the firm’s investments.
3. Investment Value Proposition:
- GWG Holdings Inc. positions life insurance as an alternative asset class, promoting its potential for superior risk-adjusted returns compared to conventional investments. By carefully managing the life expectancy and market conditions, they aim to optimize the value derived from life insurance assets.
Summary
GWG Holdings Inc. stands out in the life insurance financing landscape through its targeted acquisition practices, robust underwriting processes, and innovative agent engagement strategies. By refining its operational mechanisms and employing a data-driven approach to risk management, the company seeks to secure promising returns from life insurance as a viable alternative investment. The establishment of the Appointed Agent Program marks a strategic shift to harness the expertise of financial professionals, reinforcing GWGs initiatives to revolutionize access to life insurance assets in the secondary market.
GWG Holdings Inc. operates in the sector of life insurance finance, specializing in the purchasing and management of life insurance assets in both primary and secondary markets. Their primary focus revolves around acquiring life insurance policies from policy owners, facilitating a unique investment avenue that contrasts with traditional asset categories.
Segments and Product Offerings
1. Life Insurance Asset Acquisition:
- Primary Market Purchases: GWG acquires life insurance assets directly from policyholders who have purchased life insurance policies.
- Secondary Market Transactions: The company traditionally sourced policies from a network of specialized brokers who assist in connecting sellers with buyers interested in the secondary market.
2. Appointed Agent Program:
- This program engages financial professionals, including financial advisors and life insurance agents, to educate them about the life insurance secondary market and empower them to bring this markets value to their clientele. The program comprises:
- Education and Training: Providing resources to ensure that agents understand the intricacies of life insurance assets.
- Regulatory Compliance Support: Ensuring that agents are knowledgeable about the legal aspects surrounding life insurance transactions.
- Marketing Assistance: Offering marketing materials and support to help agents promote GWG’s offerings.
3. Underwriting and Valuation Services:
- GWG emphasizes the acquisition of high-quality life insurance assets through rigorous underwriting practices. Key components include:
- Life Expectancy Assessment: Utilizing independent medical-actuarial firms to estimate the life expectancy of insured individuals. The average of two life expectancies is typically used to assess and value policies.
- Innovative Practices: The company is committed to improving the efficiency and accuracy of its underwriting processes, particularly for small face policies (typically under $1 million).
4. Operational Efficiency Enhancements:
- GWG has made significant strides in reducing the timeframe required for preliminary underwriting assessments. The timeline has been cut down from several weeks to just days, enhancing competitiveness in market development.
- Continuous refinement of underwriting protocols is a priority, incorporating multivariate analysis and advanced testing methodologies to improve mortality predictions.
Risk Management and Value Proposition
1. Financial Performance:
- GWG generates profits by capturing the spread between the purchase cost of life insurance policies and the face value of the benefits received from these policies upon maturity. This model hinges on maintaining premium payments on acquired policies.
2. Risk Mitigation Strategies:
- Longevity Risk: The firm actively manages longevity risk by leveraging data analysis to enhance mortality predictions. It utilizes both traditional actuarial methods and novel data approaches, including socio-economic and medical testing variables.
- Credit Risk Management: Assessing the creditworthiness of insurance companies that underwrite the purchased life insurance policies is critical to safeguarding the firm’s investments.
3. Investment Value Proposition:
- GWG Holdings Inc. positions life insurance as an alternative asset class, promoting its potential for superior risk-adjusted returns compared to conventional investments. By carefully managing the life expectancy and market conditions, they aim to optimize the value derived from life insurance assets.
Summary
GWG Holdings Inc. stands out in the life insurance financing landscape through its targeted acquisition practices, robust underwriting processes, and innovative agent engagement strategies. By refining its operational mechanisms and employing a data-driven approach to risk management, the company seeks to secure promising returns from life insurance as a viable alternative investment. The establishment of the Appointed Agent Program marks a strategic shift to harness the expertise of financial professionals, reinforcing GWGs initiatives to revolutionize access to life insurance assets in the secondary market.