Private placement variable life insurance and annuities invested in hedge funds: due diligence issues for all parties to the transaction

Abstract

PurposeThe purpose of this paper is to highlight not only the pre‐closing, but also the continuing due diligence required of all parties in private placement life insurance or annuities invested in hedge funds.Design/methodology/approachThis technical paper describes the due diligence process for these high‐end offerings, illustrating key concerns through case studies.FindingsRecent events have caused the advantages, disadvantages and timing issues to crystallize, together with what issues require pre‐closing and post‐closing due diligence.Originality/valueThis paper provides timely guidance from experts approaching the issues from multiple disciplines – law, accounting, and financial analysis – to yield a comprehensive analysis of the position of all parties to the transaction.