Abacus Global Management, Inc. (NYSE: ABX)

Abacus Life, Inc., with its ticker symbol ABL, is a leading alternative asset manager and market maker specializing in longevity and actuarial technology. The company operates in the life settlements industry, which involves purchasing life insurance policies from policyholders seeking liquidity and managing them to generate returns. Abacus Life's mission is to educate life insurance policy owners and investors about alternatives to traditional investments using lifespan-based products.

Abacus Life generates revenue through its three primary business segments: Origination, Portfolio Management, and Policy Servicing. The Origination segment involves purchasing life insurance policies from consumers seeking liquidity, while the Portfolio Management segment involves actively managing these policies to generate returns. The Policy Servicing segment involves servicing bundles of policies for third-party institutions.

The Origination process is core to Abacus Life's business and drives its economics. The company has developed three high-quality origination channels: financial advisors or agents, direct-to-consumer, and traditional life settlements intermediaries. Abacus Life's proprietary risk-rating platform, known as the "Risk Rating Heat Map," measures the risk of life insurance contracts on a range from 1 to 5, providing a meaningful advantage when valuing and purchasing life insurance policies.

Abacus Life's Portfolio Management strategy involves evaluating policies to generate essentially uncorrelated risk-adjusted returns. The company has the option to either trade policies to third-party institutional investors or hold them on its balance sheet until maturity. The company's traded portfolio returns are driven by the spread generated by selling policies to third-party institutional investors and its ability to quickly recycle capital.

The company's Policy Servicing segment involves generating revenue by charging a base servicing fee of approximately 0.5% of total asset value of the portfolio. Abacus Life has experience servicing a large number of policies for highly sophisticated institutions, including policies for KKR and Apollo.

Abacus Life is well-positioned to capitalize on the anticipated growth of the life settlements industry, which is expected to grow from approximately $6 billion in 2022 to approximately $8 billion in 2028, a 5% compounded annual growth rate. The company's focus on growing its origination process, continued innovation in technology, and access to capital markets will enable it to scale its business over time.

Abacus Life operates in a highly competitive industry, with a number of established players and new entrants. The company faces competition from other life settlement brokers and investment funds, as well as from originating life insurance companies, life insurance brokers, and other market participants. The company's ability to execute its strategy and meet its objectives is dependent on its ability to originate high-quality life insurance policies, manage its portfolio effectively, and service its policies efficiently.

Abacus Life's customers include financial advisors, agents, and institutions, as well as individual policyholders. The company has experience servicing a large number of policies for highly sophisticated institutions, including policies for KKR and Apollo.

Abacus Life's brand names and/or trade names include the "Risk Rating Heat Map," a proprietary risk-rating platform that measures the risk of life insurance contracts on a range from 1 to 5. This platform provides a meaningful advantage when valuing and purchasing life insurance policies.