FORT WASHINGTON, PA, May 7, 2024: Coventry today released the results of an internal review that found life expectancy estimates issued by Lapetus Solutions, Inc. are consistently and materially shorter than those issued by other life expectancy providers, potentially leading to the overvaluation of life insurance policies and investor losses. The results cast doubt on the accuracy of asset valuations based primarily on Lapetus life expectancies.

After reviewing thousands of Lapetus life expectancy estimates, Coventry found that they are shorter than other leading life expectancy providers 85% of the time when comparing the same individuals. This suggests that their use of a general population base mortality table (rather than an insured population base mortality table) for life settlement underwriting contributes to their significantly shorter life expectancy estimates. A general population table is typically not used for these valuations because insured individuals over 65—those underwritten in any life settlement transaction—have average life expectancies more than three years longer than the general population. Study details are available at: coventry.com/research.

Coventry believes the impact on investors could be substantial and highly consequential. The insured’s life expectancy is the single most important factor when determining the value of a life settlement.

When inaccurately short life expectancies cause such assets to be overvalued, it sets the stage for liquidity issues and potential investor losses. Indeed, there are numerous examples of significant life settlement losses arising from faulty life expectancies.

“It is essential for the integrity of the market and the welfare of investors that life expectancy providers use best practices and issue reliable estimates,” said Alan Buerger, Coventry’s Executive Chairman. “As a licensed life settlement provider, we are committed to upholding industry regulations and guidelines to maintain credibility and protect stakeholders.”

Coventry is the leader and creator of the secondary market for life insurance. For more than 25 years, we have been driving the industry forward and expanding opportunities for life insurance policyowners. Coventry’s deep experience combined with a fierce commitment to consumer rights makes Coventry the clear market leader, a position we use to raise industry standards and expand consumer choice. To date, we have delivered more than $5.4 billion to policyowners who no longer need their policies. To learn more about Coventry, please visit Coventry.com.