New Insurance-Based Hedge Fund Index Launched

by Carla Johnson, Investors Offshore.com

19 January 2005

A new index based on hedge funds that accept money via insurance policies was launched last week, reflecting growing interest in this specialised and relatively undiscovered investment area.

Special variable universal life insurance policies are a tax-efficient way for wealthy individuals and institutions in the US to invest in hedge funds.

However, rules stipulate that the underlying hedge fund not be available anywhere else.

In response to growing interest in the policies, the Taylor Insurance Fund Index, launched by Greenwich, Connecticut-based hedge fund advisory firm Taylor Company, has been created to help investors track the emerging sector and provide them with performance data for analysis.

According to Dean Rubino, a partner at Taylor, hedge funds in this sector now oversee about $1 billion to $2 billion in assets, although their presence in the market place is still relatively unknown.

“Once we can show the parameters of this industry to institutions, consultants and advisers, then they can more easily decide whether the investments are a good fit with their other assets," noted Rubino.

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