The Deal Reports on GWG Earnings

More direct origination of policies, a growing portfolio and DNA methylation technology that could change the life insurance industry – those were some of the highlights of the GWG Holdings’ quarterly earnings call reported by TheDeal.

“GWG executives were pleased about other aspects of their business, which included an increase in policy maturities, growth of its portfolio and a higher percentage of policy purchases coming through its direct-origination program,” reported Donna Horowitz. “Instead of just originating policies as a provider for financial entities, as is traditionally done in the market, GWG now has positioned itself as an investor that generates policies through a sales network with a dual purpose — selling its bonds to raise capital to buy policies and using the same financial advisers to source policies to purchase.

“More direct origination of policies, a growing portfolio and DNA methylation technology that could change the life insurance industry – those were some of the highlights of the GWG Holdings’ quarterly earnings call reported by TheDeal.”

Jon Sabes

Horowitz quoted Jon Sabes about GWG Holdings success.

“We see a growing demand from capital,” Sabes said, adding there’s a potential to earn double-digit returns on an asset that’s uncorrelated to the stock market and which has a stable regulatory environment. “That’s key for growth of capital.”

“We’re making an impact. We returned $82 million to seniors in 2016 compared to $7 million in cash-surrender value,” Sabes said, referring to the amount policy owners would have received if they turned in their policies to insurers instead of selling them.

“We see these trends continuing in 2017 and beyond,” Sabes said.

On the DNA methylation technology optioned from UCLA in November, Sabes seemed especially upbeat, Horowitz reported. He said the technology determines a person’s biological age and a study showed it was predictive of all-cause mortality.

He said the company has been working to translate the science behind the discovery into a commercial product and now has used it to develop actuarial tables. He has said that the results of the DNA saliva samples collected from insured persons seeking to sell their policies would be used to enhance life expectancy reports it collects.

“We are now testing insureds whose policies we intend to purchase and comparing results of traditional methods of underwriting,” Sabes said.