Tag Canadian seniors | Here lies your money

November 24, 2015 by Leonard Goodman

Enough!

This is not a time for a “white flag!” Life insurance settlements must become a reality in all of Canada, sooner versus later

I have never been a white flag type of guy. I believe when the cause is right, quitting is not an option. And the cause that I have been pursuing, on behalf of Canadian seniors, for more than two years is right! I’ve written a book, met with numerous politicians and staff, submitted extensive documentation to government agents, communicated with many in the life insurance industry, contacted the press, had interviews, written articles, founded the Life Insurance Settlement Association of Canada … and after two years, little has changed.

I’ve had enough!

I am taking up a red flag and I intend to carry it until this critical issue is resolved. And I’ll do it on my own if I must. Like Howard Beal said in the 1976 movie, Network, “Things have got to change … I’m as mad as hell, and I’m not going to take this anymore!”

This is wrong

Six provinces in Canada prevent their residents from being able to receive fair market value for their life insurance policies if they choose to sell them and this violates a fundamental principle of a free market system. In Ontario, under the Ontario Insurance Act, there is a regulation (Section 115) that states that to buy life insurance policies from willing sellers is “trafficking” and a criminal offense. I suggest that that regulation is a violation of a person’s rights and the rights of both a seller and buyer to receive fair market value.

The Canadian Income Tax Act defines fair market value as follows:

The price a willing purchaser will buy from a willing seller in an unrestricted and open market, with neither party being under undue pressure.

Illustration courtesy meltonpriorinstitute.com

Initially, my focus has been in Ontario with it’s more than two million seniors and my point is simple:

The need for consumers to receive a fair market value for an asset they own, a life insurance policy, is a fundamental right, which currently is not available to Ontarians. Fair market value is a cornerstone of any financial sector and economy and yet, for decades seniors have been prevented from receiving the fair market value for this important asset. Basically, life insurance companies are the only buyers of policies – that’s called a monopoly – and in many cases the only alternative to selling is to let the policy lapse. The absence of a secondary market has allowed this unfair, monopolistic practice to continue for decades. Furthermore, one of the best ways of protecting consumers from monopolistic and predatory practices is to provide a well-regulated, fair and competitive marketplace.

I have spoken to hundreds of seniors and they are as perplexed and concerned as I am. Outraged that those who preach helping and protecting them (insurers and government agencies – FSCO) have done nothing for over twenty years. Unfortunately, only a small percentage of the tens-of-thousands who might choose a life settlement as an option are aware of this egregious undermining of their rights – not to mention perpetuating a barrier to their financial well-being. Therein lies the problem. Seniors don’t know about this option and no one is offering them the opportunity to learn more and explore alternatives.

I intend to change that

I am going to take the message directly to the public and offer seniors an opportunity to understand life settlements, weigh their options and if they choose, sell their policy – to me! In other words, I plan to offer a fair market value purchase of a senior’s qualifying life insurance policy, likely at a far greater value than they would receive from their life insurance company. If that’s considered “criminal,” so be it.

Enough is enough! Someone has to do what is right for Canadian seniors.

In the weeks ahead, we will be inviting those who agree with the need to create a competitive market to join us in this on going battle for seniors’ rights. If you would like news and information from the Life Insurance Settlement Association of Canada (LISAC) send your email address to: info@hereliesyourmoney.com

If anyone, including the many members of seniors’ organizations like Probus and CARP, would like to know if their policy qualifies for a life settlement and what its fair market value could be, I’d be more than happy to provide you with an estimate – no charge.

Contact: 416-368-5351 x 226 Email: agoodm5702@rogers.com

October 15, 2015 by Leonard Goodman

Flash Boys in life insurance

“It would have been difficult to find anyone, circa 2009, able to give you an honest account of the inner workings of the American stock market … complicated beyond belief by possibly well-intentioned regulators and less well-intentioned insiders. That the American stock market had become a mystery struck me as interesting. How does that happen? And who benefits?” – Michael Lewis, April 2015

I recently read Michael Lewis’s bestselling book, Flash Boys, and was struck – amazed – at how common the Wall Street themes and conditions were to the life insurance industry, and what I encountered before writing my book, Why Are Canadian Seniors Worth More Dead Than Alive? Paraphrasing and changing slightly what Lewis said above, I would say:

“It would have been difficult to find anyone, circa 2009, able to give you an honest account of the inner workings of the Canadian life insurance industry … complicated beyond belief by possibly well-intentioned regulators and less well-intentioned insiders. That the Canadian life insurance industry has maintained and promoted a false premise and used false indicators to protect their financial position and erode Canadian seniors’ financial position has become too egregious for me. How does that happen? And who benefits? That’s why I wrote my book.” – Leonard H. Goodman, October, 2015

My purpose parallels Michael Lewis’s in many ways. Primarily, to expose practices (for Lewis, it’s high frequency trading) that amount to the the theft of the public’s invested money and retirement assets, which has continued unabated for decades, mainly because the public does not know and the insiders influence governments, insidiously. As Lewis claims, this injustice is sanctioned by government regulators. For example, in the case of life settlements in Ontario, the Financial Services Commission of Ontario (FSCO), a government agency, which is currently under review by the Ministry of Finance, has ignored for two decades the potential for a well-regulated life settlement industry.

Canadian seniors have invested for decades in their life insurance (an asset they own) and yet, they have no access to a secondary market where they could receive fair market value for their policy through a life settlement. As in Flash Boys, it is those with the power and money that control and manipulate the system – and governments – to their advantage. As Lewis states, “people are getting screwed …” because of injustice perpetrated against unknowing investors (substitute: policy owners) by the greed of large Wall Street banks (substitute: Canadian life insurance firms).

Goldman Sachs’s Manhattan headquarters (photo by Justin Bishop)

As Lewis said, “The Flash Boys story put in jeopardy billions of dollars of Wall Street profits and a way of financial life … It became inevitable that Flash Boys would seriously piss off a few important people: anyone in an established industry who stands up and says “The way things are being done here is totally insane; here is why it is insane; and here is a better way to do them” is bound to incur the wrath of established insiders, who now stand accused of creating the insanity.” – Michale Lewis, April 2015

Canadian life insurance companies face somewhat the same jeopardy because a secondary market for life settlements would move billions of dollars from their pockets into the pockets of seniors. Even though it is the right thing to do, they have resisted it for decades. They are not interested in what is good for their customers, Canadian seniors, government healthcare costs or our country, they are only focused on their bottom line. It’s a travesty of justice and moral values.

Like Lewis, I want to open up a closed window and expose the egregiously entrenched greed that’s rooted in the self-interests of the Canadian life insurance industry, all of which is to the detriment of 5.6 million Canadian seniors, not to mention all taxpayers.

“If this story (Flash Boys) has a soul, it is in the decisions made by its principal characters to resist the temptation of easy money and to pay special attention to the spirit in which they live their working lives. I didn’t write about them because they were controversial. I wrote about them because they were admirable. That some minority on Wall Street is getting rich by exploiting a screwed-up financial system is no longer news. That is the story of the last financial crisis, and probably the next one, too. What comes as news is that there is now a minority on Wall Street trying to fix the system … All they need is a little help from the silent majority.” – Michael Lewis, April 2015.

Michael Lewis’s book changed the stock market landscape forever, and I believe we can do the same in the Canadian life insurance industry.

Never doubt that a small thoughtful group of people can change the world. Indeed, it is all that ever has. – Margaret Mead, anthropologist.

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May 6, 2015 by Leonard Goodman

Strange politics in an election year

Meet the Chair of the Conservative Party’s insurance caucus, Peter Braid

Perhaps the constituents of MP, Peter Braid (Kitchener-Waterloo) can be more successful than I have been in opening up a conversation with him. Over the last couple of months I’ve sent several communications to Mr. Braid (see last email below) and as of yet, no response. That’s strange in an election year. And what’s even stranger is the fact that Mr. Braid is head of the Conservative’s insurance caucus and I have attempted to communicate with him on an important life insurance issue, not to mention that I have been affiliated with the life insurance industry for more than fifty years.

I am not sure if it is lack of respect or a lack of political savvy. Either way, I don’t think Mr. Braid is familiar with the axiom espoused by the late Tip O’Neill, US Speaker of the House, who said, “All politics is local.” In other words, politicians need to pay attention to what the voters are asking. And I have been asking Mr. Braid some tough questions – on behalf of his voters – regarding life settlements and the opportunity that they can provide in helping seniors with their financial difficulties. He might be able to ignore me, but he ignores the needs of seniors at his peril.

“Give people options … voluntary choices”

It appears as if Mr. Braid is not only ignoring his constituents on this issue but also the thinking and counsel of his boss, Prime Minister Harper. Harper, in a post-budget comment said, “Our government does not believe in forcing Canadians into a single, compulsory one-size-fits-all approach. That’s why we give people options, voluntary choices to help us save …. What we will not suggest is raising taxes on workers that they don’t want to pay and claiming it is, quote, for their own good, and then hitting small businesses with tax hikes that small business cannot afford to pay.” That’s a pretty clear direction: “… give people options” and “voluntary choices’ that do not cause “tax hikes.”

Well, that’s exactly what I want to discuss with Mr. Braid – how life settlements can offer seniors a valid option for accessing greater value in their policies if and when they need it rather than relying on taxpayer money. But his lack of response suggests that “options,” “voluntary choices” and open discussion are not his idea of collaboration.

To lead or avoid change?

Perhaps Mr. Braid might consider the words that former Conservative Prime Minster, Brian Mulroney wrote this week (May 4, 2015) in a Globe and Mail article. Mulroney, speaking of leaders, said, “they must be ready to endure the attacks that often accompany profound or controversial change, while they await the distant and compelling sounds of a verdict that only history and a more reflective nation can render in the fullness of time.” Will Mr. Braid choose to lead or avoid?

In Mr. Braid’s own words

On November 18, 2014, Mr. Braid introduced Donald Gulioen, CEO Manulife and Chair of the Canadian Life and Health Insurance Association (CLHIA), at an industry “Advocacy Day” in Ottawa as they celebrated the industry’s accomplishments (see previous blog below).

I was encouraged by Mr. Braid’s words when he said, “My community has deep roots in the insurance industry and I also have worked in the sector … so I have a good understanding of the important role that insurance companies play in providing security for Canadians and strengthening our national economy.” He added that the industry was “committed to enhancing the well being of families and communities across our great country. Today’s Advocacy Day provides an excellent opportunity to further collaborate on our shared goals.” Based on his views, I decided to open up a dialogue with Mr. Braid.

“Keep your friends close, but your enemies closer.” – Sun Tzu (and Michael Corleone, Godfather Part II)

Michael Corleone

Friends or enemies?

It has been several months and nothing from Mr. Braid and yet, when it comes to the best interests of seniors, I assume Mr. Braid and I are on the same side. My goal is to advocate for doing what is best for seniors but I have no idea what Mr. Braid’s ideas might be concerning the “well being” of more than a million Canadian seniors in need. What I do know, from evidence around the world, is that life settlements are of significant financial benefit to seniors.

I sent him a copy of my book, Why Are Seniors Worth More Dead Than Alive? and other documentation regarding seniors’ financial plight and the potential of life settlements, so I know he has lots of information for a dialogue. But guess what? As I continue to distribute information via my blog, Mr. Braid has “unsubscribed.” Obviously, his concept of collaboration is different than mine, and I’ll bet different from what voters consider collaboration.

I expected Mr. Braid, Chair of his Party’s insurance caucus, to lead an in depth discussion on the merits of life settlements, not opt to avoid my questions. However, I suspect he thinks life settlements are a “controversial change” and that if he was to engage in a conversation, he might, as Brian Mulroney says, have to “endure the attacks” of his friends and supporters in the life insurance industry. That’s unfortunate – for his constituents and Canadian seniors everywhere.

My latest email to Mr. Braid

Mr. Braid, during the past few months I have delivered to you well researched evidence of an egregious disservice being perpetrated on millions of Canadian seniors, (read voters). You have not only ignored my material but elected to unsubscribe to further information. I shall continue to advocate for these seniors, most of who desperately need these funds to improve quality of life and perhaps remove many from government subsidies. A number of years ago, Tory MP Frank Sheehan, Chair of a legislative committee appointed to look at the matter, when questioned by noted columnist James Daw as to why nothing has happened on this subject responded, “The government’s legislative agenda is too busy. We just can’t free up the market without giving thought to the potential for abuse.” Fair enough!

Do you not think that more than 15 years is enough time for your party Mr. Braid? Who are we considering here, seniors or life insurance companies?

That is the question I will be asking the numerous seniors groups, (voters?) inviting me to appear before their various chapters during the coming months.

I shall be pleased to discuss with you!

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