Melville Capital, LLC Uncovers $300,000 for Three Chapter 7 Estates in the Sale of a Life Insurance Policy Wrongfully Confirmed As Lapsed By the Insurance Company

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Sep 04, 2014, 08:30 ET

NEW YORK, Sept. 4, 2014 /PRNewswire/ -- Melville Capital, LLC brokered the sale of a life insurance policy in a highly time sensitive and complicated matter where the policy was thought to have lapsed without value by the insurer.

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Unlock life insurance policies. (PRNewsFoto/Melville Capital)

Melville Capital (PRNewsFoto/Melville Capital)

Photo - http://photos.prnewswire.com/prnh/20140903/142683

The life insurance policy at hand was fractionally owned by three brothers and a cousin. The three brothers eventually filed for voluntary chapter 7 protection in the Central District of California, creating three separate estates, each with a respective one-quarter interest in the life insurance asset (Bijan Navabian (Case No. 2:13-BK-20401-RK); Bahman Navabian (Case No. 2:13-BK-20405-TD); and Bahram Navabian (Case No. 2:13-BK-24630-TD)).

This engagement was led by Doug Himmel, Melville Capital's Managing Director. According to Himmel, the policy had not actually lapsed -- but was in a "state of lapse" -- where substantial premium was required to keep the policy in-force. After being engaged by each of the respective Trustees, Melville marketed the policy and ultimately received an offer of $300,000 plus approximately $40,000 in back premiums due the insurance carrier.

Himmel further commented that purchasers do not typically buy policies that are past due in premiums and coordinating four separate closings, three of which were bankruptcy court matters before two different judges, and the need for shortened notice, made this stand out as one of his more complicated cases.

The sale order was entered just days before an actual policy lapse, which if it had occurred, would have rendered the policy worthless to the fractional owner estates.

About Melville Capital

Melville Capital focuses on monetizing and liquidating existing life insurance policies. With offices in New York, Los Angeles and Scottsdale, Melville is the country's premier Life Settlement Broker practicing in the area of restructuring and insolvency. In insolvency matters, there is often substantial cash flow generated to individuals/companies in transition, policy owners, Turnaround and Bankruptcy advisors, and Trustees. Melville represents the policy owner, insured and referral source in negotiating and accepting bids from competing Institutional Investors and handles all aspects of the transaction. The net result is a lump sum cash settlement that is often much greater than the cash surrender value and relieves the policy owner of all future premium payments.

Melville has served in the capacity of life settlement broker to a variety of individuals and entities, including in bankruptcy cases. For example, Melville has been retained in the following bankruptcy cases, among others: (i) In re Princeton Ski Shop, Inc. (Case No. 07-26206) (District of New Jersey) (retained by the Official Committee of Unsecured Creditors); (ii) In re Ronco Corporation, et al. (Jointly Administered under Case No. 1:07-12000 GM) (Central District of California) (retained by the Chapter 7 Trustee); (iii) In re Thomas K. Helton Inc. d/b/a Home Lumber Company (Case No. 07-12671-JKC-11) (Southern District of Indiana) (retained by Liquidating Agent); (iv) In re Wilder, (Case No. 09-71141 (MPG)) (Central District of Illinois, Eastern Division) (retained by the Chapter 7 Trustee); (v) In re Bokavich, (Case No. 09-11106-WCH) (District of Massachusetts, Eastern Division) (retained by the Chapter 7 Trustee); and (vi) In re M. Fabrikant & Sons, Inc. and Fabrikant – Leer International, Ltd., (Case No. 06-12737) (Southern District of New York) (retained by the Client); (vii) In re Life Fund 5.1, LLC ("A&O"), (Case No. 09-32672) Northern District of Illinois, Eastern Division) (retained by the Trustee); (viii) In re SageCrest II LLC, et al. , (Case No. 08-50754) (District of Connecticut, Bridgeport Division) (retained by the Wind-Down and Workout Manager; (ix) In re Peregrine Financial Group, et al. (Case No. 1:12-cv-05383) (Northern District of Illinois) (retained by the Receiver).