New York based alternative investment specialist, BroadRiver Asset Management, L.P, has raised $876 million of commitments for its third life settlements fund, with capital coming from institutional limited partners from North America, Europe, and the Middle East.
BroadRiver has a longevity focus for its life settlements strategy, named BroadRiver III, L.P., and the investment manager said its commitments come from a wide range of global institutional investors, including public, private, and sovereign pension plans, endowments and foundations, as well as some large family offices.
“The breadth and depth of our limited partner investors, including many commitments from investors in our previous funds, affirms BroadRiver’s position as a premier underwriter of older-age people in the U.S.,” explained Andrew Plevin, Co-CEO of BroadRiver Asset Management.
“To enhance our lead in this aspect of alternative fixed income, we continue to extend and refine our research and analysis of factors affecting longevity and our related risk management systems,” he continued.
BroadRiver aims to provide its investor base with exposure to a fixed-income-like, attractive, risk-adjusted return, that exhibits low volatility, and has negligible correlation to the wider financial markets, the company said.
The manager approaches acquisition of life settlement assets using its proprietary analytics and a research led approach, which it believes results in a more structured portfolio that delivers strong, predictable cash flows.
Denning and Company LLC, a San Francisco-based alternative fund placement firm, acted as the lead global agent for BroadRiver’s third life settlement fund capital raise.
Some insurance-linked securities (ILS) fund managers do allocate capital to life settlements via their life ILS funds. As we’ve written before, there are hurdles to overcome before broader adoption is seen in the ILS market, but the life settlements investment space is working to gain broader acceptance within the ILS universe and there is a signficant cross-over within the investor base now.
Of course, being longevity linked assets, they don’t suit all pension investors, who often have ample longevity exposure of their own, but appetite to invest in life insurance linked investments continues to grow, as evidenced by the growth of some of the main life ILS funds as well.