Insurance Settlement Valuation

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Case Study

Analyze and value a portfolio of insurance settlements with variable cash flows and attached optionality, for the structured settlements investments team at a hedge fund. Our client was evaluating whether to acquire the portfolio and analyzing the potential payouts.


  • Combine data from the insurance servicer with both internal proprietary research and demographic information in the public domain
  • Determine future cash flows with associated probabilities, and identify all attached optionality and calculate option values
  • Visualize drivers of value through traditional charts and new data visualization techniques


  • Provide transparency into the underlying settlement and the ability to independently value the portfolio
  • Quickly test scenarios by changing assumptions, parameters, and data sets
  • Online tools enabled the hedge fund to both use the analytics internally and easily collaborate with partners and investors
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