Broker-dealer and RIA professional liability insurance costs have skyrocketed and many IBDs and RIAs are facing the prospect of having to walk away from profitable commercial real estate and alternative investment securities sales opportunities because of the cost or because the carrier is now specifically excluding these transactions from coverage. The impact has been devastating: revenues were down for the industry last year while operating costs were up double-digits and professional liability insurance was a prime contributor. RIA professional liability insurance cost reduction has to become a reality or the boutique and regional firms are going to be squeezed out of the securities industry altogether.
The issue is investment loss severity risk – the source of future investment fraud claims loss severity risk that drives carrier premium pricing. INVIZEN offers the only end-to-end solution designed to specifically address these problems by providing a suite of proactive, real-time due diligence and investment loss prevention monitoring services that operate in real-time to help eliminate the propensity for bankruptcy petition filings resulting from unforeseen liquidity crises and those pesky administrative default foreclosure events – for the full term of the investment holding period.
The INVIZEN approach is a technology solution that has the potential to completely change the commercial real estate securities private placement offerings under Direct Participation Programs in a way that is long overdue because INVIZEN is the only systemic solution that focuses on investment loss severity risk that is caused by market disruptions at the local market level. This is only possible because INVIZEN’s real-time technology provides a full site/market intended-use valuation analysis of up to 28 different asset class profiles, then a full, complete and tested market and financial feasibility analysis of the site, market and project every month of the asset holding period. The outputs of the valuation and feasibility analysis real-time evaluations feed directly into the INVIZEN real-time underwriting suite that provides sponsors, lenders, investors, broker-dealers, registered investment advisors and asset managers with a comprehensive underwriting review of collateral, credit, capacity and default risks as if it were underwriting the entire transaction for the first time on the buy-side of the deal.
INVIZEN is affordable. If INVIZEN underwrites and enrolls the asset in our Real-Time Status (RTS) Asset Care Protection Program the program cost is charged to the sponsor, so you pay nothing. The fee for our longest term contract (a 10-year enrollment agreement) is less than 1.5% of the transaction value and paid over the course of that 10-year period. You bet it’s affordable.
Find out more today and get your game back and your future economic opportunity by talking to a representative at INVIZEN today at 832.663.9634.