An RIA buy-side partnership for life settlements allows a registered investment advisor to recommend direct-ownership life settlement allocations to accredited clients as part of holistic portfolio construction. Compensation operates through a solicitor fee arrangement compliant with SEC Rule 206(4)-3 (the Solicitor Rule) — typically a one-time placement fee or ongoing basis-points relationship tied to allocated capital. Onboarding involves a six-step workflow from initial call through capital deployment, supported by an eight-document compliance packet including the Solicitor Agreement, Form ADV updates, and full diligence book per opportunity. Invest in life settlements through HYV as the RIA channel partner with institutional-grade infrastructure and compliance support.
Most advisor content about life settlements describes the sell-side referral — a client wants to sell their policy, the advisor refers them to a licensed provider, the advisor earns a commission on the transaction. That's valid revenue, but it's a one-time event tied to a specific client's specific policy. The far larger and more sustainable opportunity for RIAs operating fiduciary practices is the inverse: recommending life settlement direct-ownership as a buy-side allocation for accredited clients seeking alternative income or rate-uncorrelated diversification. After more than two decades building RIA partnerships at institutional scale, the framework below is how I've onboarded fiduciary advisors into the buy-side channel — with the compliance discipline that protects both the RIA's practice and the underlying client's outcome.
Sell-side vs buy-side referrals — different economic models entirely
The first conceptual clarification for RIAs entering this space is that "life settlement advisor referral" actually describes two completely different transaction types with different compensation mechanics, different regulatory frameworks, and different client populations.
Sell-side referral is what most industry content describes. The advisor's client owns a life insurance policy they no longer want, need, or can afford. The advisor refers the client to a licensed life settlement provider or broker, who appraises the policy and presents an offer. If the client accepts and the transaction closes, the advisor typically receives a referral fee or commission from the provider (subject to state regulation — some states require advisor licensing for this). The advisor's role is essentially a one-time intermediation. Compensation is one-time. Client relationship continues but no recurring revenue from this transaction. Compliance treatment varies by state and by the advisor's licensing status.
Buy-side allocation is the inverse. The advisor's accredited client is seeking yield-oriented alternative allocations as part of holistic portfolio construction. The advisor recommends life settlement direct-ownership as one component of the alternative sleeve — alongside real estate, private credit, or other alternative allocations. The transaction is the client purchasing a life settlement position, typically through an institutional platform that originates and presents vetted opportunities. Compensation operates through a solicitor fee arrangement under SEC Rule 206(4)-3 — a regulated, disclosed, written arrangement that is structurally different from traditional referral commissions. The client relationship is ongoing because the allocation is part of a multi-year portfolio.
For RIAs operating fiduciary practices, the buy-side model aligns with the advisor's fundamental value proposition: holistic portfolio construction for accredited clients, with compensation tied to advisor expertise and ongoing client relationship rather than to product transactions. The economic scale is also materially larger. A sell-side referral generates one-time revenue on a single client's single policy. A buy-side partnership can generate ongoing solicitor compensation across multiple clients' multi-year allocations.
SEC Rule 206(4)-3 framework for buy-side compensation
The regulatory framework governing buy-side life settlement compensation for RIAs is SEC Rule 206(4)-3 under the Investment Advisers Act of 1940 — commonly known as the Solicitor Rule. The Rule permits SEC-registered investment advisers to pay cash referral fees to third-party solicitors who refer clients to the advisory firm, provided specific conditions are met. The framework was significantly updated in 2020 (effective November 2022) under the new Marketing Rule, expanding and modernizing the Solicitor Rule into broader testimonial and endorsement framework.
For the RIA acting as buy-side referral channel to a life settlement platform, the basic structure is: the platform compensates the RIA for client referrals, the RIA and platform execute a written Solicitor Agreement documenting the arrangement, and the RIA discloses the compensation arrangement to the client per Form ADV requirements. The compensation can be structured as a one-time placement fee tied to capital deployed, an ongoing basis-points relationship on allocated AUM, or hybrid structures combining both.
Critical compliance elements include: written Solicitor Agreement between the platform and the RIA documenting the compensation terms; Form ADV updates by the RIA disclosing the third-party compensation arrangement in Part 2A Item 14 (Client Referrals and Other Compensation); client disclosure at the time of referral describing the nature and amount of compensation; state-level IAR registration where applicable (the SEC framework permits the arrangement, but many states define solicitation as IAR activity requiring registration); and recordkeeping per Investment Advisers Act of 1940 Rule 204-2.
The SEC Marketing Rule guidance and NASAA Uniform Securities Act are the authoritative federal and state regulatory references. RIAs entering buy-side life settlement partnerships should consult with their compliance counsel to verify state-level IAR registration requirements and document the Solicitor Agreement structure correctly.
Number of accredited clients a single $50M+ AUM RIA can typically introduce to a life settlement buy-side allocation within the first 12 months of partnership, based on accreditation distribution within high-net-worth advisory practices. Sustained partnerships often expand beyond this baseline over 2-3 year periods as the alternative allocation framework becomes embedded in the RIA's planning process.
Invest in life settlements through an institutional RIA channel
HYV's RIA Partnership Program delivers full compliance infrastructure — Solicitor Agreement template, Form ADV guidance, and eight-document packet — anchoring buy-side allocations for accredited clients across two decades of practice.
The six-step RIA onboarding workflow
Onboarding an RIA into a buy-side life settlement partnership is a structured process. Each step has a defined timeline, deliverables, and compliance touchpoint. The sequence below reflects institutional best practice for RIA partnerships.
Initial partnership call
Introductory meeting covering the buy-side allocation framework, sample client profiles that fit, compensation structure under SEC Rule 206(4)-3, and partnership materials review. No commitment required at this stage — both sides assess mutual fit.
Compliance and regulatory review
RIA's compliance counsel reviews the proposed Solicitor Agreement, verifies state-level IAR registration requirements, and confirms Form ADV update path. Platform's compliance team coordinates documentation. Any state-specific provisions addressed in this window.
Solicitor agreement execution
Written Solicitor Agreement executed between RIA and platform. Agreement documents compensation terms, scope of solicitation activity, disclosure obligations, and recordkeeping requirements. Both parties retain executed copies for compliance files.
Client suitability training
RIA team participates in suitability training covering accredited investor verification, life settlement risk taxonomy, allocation sizing best practices, and integration with broader portfolio construction. Suitability questionnaire template provided.
First-client diligence walkthrough
RIA introduces qualified accredited client. Platform provides full opportunity-specific diligence book including LE underwriting, carrier rating, policy documentation, premium projections, and projected after-tax IRR. Client and RIA review together with platform support.
Capital deployment and ongoing support
Client commits capital to specific opportunity. Platform executes acquisition through licensed provider channel. RIA receives solicitor compensation per Solicitor Agreement schedule. Ongoing client servicing continues with platform's operational infrastructure plus RIA's portfolio oversight role.
The full onboarding cycle typically completes in 6-10 weeks, with the compliance review window being the most variable element (some RIAs have established compliance counsel that moves quickly; others require external review with longer timelines). Following onboarding, subsequent client introductions move through the diligence and deployment phases without repeating the agreement and training steps — typical second-client timelines run 4-6 weeks from introduction to deployment.
The eight-document compliance packet
Institutional-quality buy-side partnerships rely on a documented compliance packet that protects both the RIA's practice and the client's interests. The eight-document standard below is what HYV provides to partnering RIAs and what advisors should expect from any institutional life settlement platform.
Eight documents protecting the partnership
Solicitor Agreement
Written contract per SEC Rule 206(4)-3 documenting compensation terms, scope, disclosure obligations, and recordkeeping requirements between platform and RIA.
Form ADV update template
Pre-populated text for Form ADV Part 2A Item 14 (Client Referrals and Other Compensation) describing the third-party compensation arrangement for the RIA's annual filing update.
Client disclosure document
Written disclosure provided to each referred client at time of referral, describing the nature and amount of compensation the RIA receives from the platform for the introduction.
Suitability questionnaire
Template questionnaire for the RIA to use in verifying accredited investor status, risk tolerance, liquidity needs, and allocation sizing appropriate to life settlement holdings.
Diligence book template
Standard format for opportunity-specific diligence material including LE underwriting, carrier rating, premium schedule, policy documentation, and projected IRR scenarios.
State IAR compliance checklist
State-by-state checklist of IAR registration requirements applicable to the RIA's solicitor activity, including states where additional licensing may be required.
Recordkeeping standards
Documentation standards per Investment Advisers Act of 1940 Rule 204-2 covering retention of Solicitor Agreement, client disclosures, and referral activity records.
Platform operational documentation
Description of the platform's institutional infrastructure including custodian arrangements, master servicer, backup servicer, and AM Best A-rated carrier focus per the operational standard.
The compliance packet is not optional infrastructure — it is the foundation that allows the RIA to recommend life settlement allocations within fiduciary duty without exposing the practice to regulatory risk. Each document serves a specific protective function: the Solicitor Agreement establishes the legal basis for compensation; the Form ADV update creates the public disclosure record; the client disclosure document provides the consent-with-information that fiduciary duty requires; the suitability questionnaire creates documented evidence that the RIA evaluated client fit; the diligence book template ensures consistent quality of opportunity-specific analysis.
- Buy-side partnerships differ structurally from sell-side referrals. Compensation operates through SEC Rule 206(4)-3 Solicitor Rule framework with written agreement and Form ADV disclosure, not transactional commission.
- Confirm state-level IAR registration requirements. The SEC framework permits the arrangement; many states define solicitation as IAR activity requiring registration. State-by-state verification is essential before partnership launch.
- Coordinate with the RIA's compliance counsel early. The compliance review window is typically the most variable element of onboarding. Engaging counsel at Week 1 accelerates the path to executed Solicitor Agreement.
- Treat the compliance packet as the partnership foundation. The eight-document standard protects both the RIA's practice and the underlying client's interests. Institutional platforms provide this documentation systematically.
Browse the RIA partnership opportunities
HYV's RIA partnership program operates with full SEC Rule 206(4)-3 compliance support — Solicitor Agreement template, Form ADV update guidance, eight-document compliance packet, and dedicated partnership team supporting accredited client onboarding.
Browse the platformThe accredited clients who invest in life settlements through HYV often come through RIA channel partners who have built buy-side life settlement allocation into their holistic planning process. The compensation arrangement is documented and disclosed; the diligence framework matches what institutional buyers like Apollo Global Management, Berkshire Hathaway, and Partner Re use for their own portfolios; the operational infrastructure follows institutional servicing standards. For RIAs evaluating whether life settlements fit their advisory practice, the broader fiduciary framework is covered in our step-by-step investment guide.
Build an RIA partnership with HYV
HYV's RIA Partnership Program delivers the full institutional framework — SEC Rule 206(4)-3 compliance documentation, six-step onboarding workflow, eight-document compliance packet, and dedicated partnership director supporting accredited client allocations.
SEC-registered investment advisers entering buy-side life settlement partnerships operate under SEC Rule 206(4)-3 (the Solicitor Rule) under the Investment Advisers Act of 1940. The Rule was modernized in 2020 (effective November 2022) as part of the new Marketing Rule, expanding the framework into broader testimonial and endorsement requirements. Compensation must be documented in a written Solicitor Agreement between the platform and the RIA, disclosed in Form ADV Part 2A Item 14 (Client Referrals and Other Compensation), and presented to each referred client at the time of referral. The SEC Marketing Rule guidance publishes the authoritative federal framework.
State-level regulation operates through the framework adopted by individual state securities regulators, many following the NASAA Uniform Securities Act. The NASAA framework defines an Investment Adviser Representative (IAR) as one who "solicits, offers, or negotiates for the sale of or sells investment advisory services" — effectively requiring solicitor activity to be conducted through a registered IAR in most states. Specific state-level IAR registration requirements vary; some states accept the SEC framework without additional registration, while others require Series 65 examination, U4 filing, or registration through an existing RIA. RIAs entering buy-side partnerships should verify state-level requirements with compliance counsel before partnership launch.
Federal investor accreditation under SEC Rule 501 of Regulation D defines accredited investor as individuals with $200,000 annual income ($300,000 joint with spouse) for two consecutive years with reasonable expectation of the same, or net worth above $1,000,000 excluding primary residence. All life settlement direct-ownership investments are restricted to accredited investors. Life Insurance Settlement Association (LISA) provides industry education for financial professionals across both sell-side and buy-side advisory contexts. The eight-document compliance packet standard is institutional best practice for life settlement RIA partnerships and protects both the advisor's fiduciary obligation and the underlying client's interests through documented suitability, disclosure, and recordkeeping.
Frequently asked questions
What is a life settlement RIA partnership?
A life settlement RIA partnership is a structured arrangement between a Registered Investment Advisor and a life settlement investment platform that allows the RIA to recommend direct-ownership life settlement allocations to accredited clients as part of holistic portfolio construction. Compensation operates through a solicitor fee arrangement compliant with SEC Rule 206(4)-3 — typically a one-time placement fee tied to capital deployed, an ongoing basis-points relationship on allocated AUM, or a hybrid structure. This is structurally different from traditional sell-side referrals where an advisor refers a policyholder to sell an unwanted policy and earns a one-time commission. Buy-side partnerships generate ongoing compensation aligned with the RIA's fiduciary practice and accredited client base.
How does SEC Rule 206(4)-3 apply to life settlement referrals?
SEC Rule 206(4)-3 — the Solicitor Rule under the Investment Advisers Act of 1940 — permits SEC-registered investment advisers to pay cash referral fees to third-party solicitors who refer clients to the advisory firm, provided specific conditions are met. For RIAs acting as buy-side referral channels to life settlement platforms, the framework requires a written Solicitor Agreement documenting compensation terms, Form ADV Part 2A Item 14 disclosure of the third-party compensation arrangement, written disclosure to each referred client at time of referral, recordkeeping per Rule 204-2, and state-level IAR registration where applicable. The Rule was modernized in 2020 (effective November 2022) as part of the new SEC Marketing Rule, expanding the framework into broader testimonial and endorsement requirements.
What is the difference between sell-side and buy-side life settlement referrals?
Sell-side referral is when the advisor's client owns an unwanted life insurance policy, the advisor refers the client to a licensed life settlement provider, and the advisor receives a one-time referral fee or commission if the transaction closes. Buy-side allocation is the inverse — the advisor's accredited client is seeking yield-oriented alternative allocations, the advisor recommends life settlement direct-ownership as part of holistic portfolio construction, and compensation operates through an ongoing solicitor fee arrangement under SEC Rule 206(4)-3. Sell-side is transactional and one-time per client policy; buy-side is relational and can extend across multiple clients and multi-year allocations. The two models also serve different client populations: sell-side serves policyholders wanting liquidity; buy-side serves accredited investors seeking allocation.
How long does RIA partnership onboarding take?
The full onboarding cycle for a new RIA partnership typically completes in 6-10 weeks across six steps: initial partnership call (Week 1), compliance and regulatory review (Weeks 2-3), Solicitor Agreement execution (Week 4), client suitability training (Weeks 4-5), first-client diligence walkthrough (Weeks 5-8), and capital deployment with ongoing support (Weeks 8+). The compliance review window is typically the most variable element — some RIAs have established compliance counsel that moves quickly, while others require external review with longer timelines. Following initial onboarding, subsequent client introductions move through diligence and deployment phases without repeating the agreement and training steps, typically running 4-6 weeks from introduction to deployment.
What compliance documentation should an RIA expect from the platform?
Institutional life settlement platforms provide an eight-document compliance packet to partnering RIAs: written Solicitor Agreement per SEC Rule 206(4)-3, Form ADV Part 2A update template for Item 14 disclosure, client disclosure document for each referred client, suitability questionnaire template for accredited verification, diligence book template for opportunity-specific analysis, state IAR compliance checklist by state, recordkeeping standards per Rule 204-2, and platform operational documentation covering custodian, servicer, and carrier infrastructure. Each document serves a specific protective function — the Solicitor Agreement establishes the legal basis for compensation, the Form ADV update creates the public disclosure record, the client disclosure provides informed consent, and the suitability questionnaire creates documented evidence of fit evaluation.
Do RIAs need additional state licenses to refer clients to life settlement allocations?
The SEC Rule 206(4)-3 framework permits the solicitor arrangement at the federal level, but state-level registration requirements vary. Most state securities regulators following the NASAA Uniform Securities Act define solicitation as IAR (Investment Adviser Representative) activity requiring registration — typically through Series 65 examination, U4 filing, or registration through an existing RIA. Some states accept the SEC framework without additional registration; others require state-specific IAR registration before the RIA can engage in solicitation activity. The state IAR compliance checklist provided in the standard partnership compliance packet covers state-by-state requirements. RIAs entering partnership should verify state-level requirements with compliance counsel before launch — particularly in states where the RIA's existing IAR registration may not cover solicitor activity.
How is RIA compensation typically structured in life settlement partnerships?
RIA buy-side compensation operates through SEC Rule 206(4)-3 Solicitor Rule framework as cash referral fees, structured in three common patterns: one-time placement fees tied to capital deployed by referred clients; ongoing basis-points relationships on allocated AUM; or hybrid structures combining a placement fee with ongoing relationship compensation. Specific compensation rates vary by platform, RIA scale, and partnership structure — most institutional arrangements fall within ranges consistent with broader alternative investment solicitor compensation in the wealth management industry. All compensation must be documented in the written Solicitor Agreement, disclosed in Form ADV Part 2A Item 14, and presented to each referred client at time of referral per Rule 206(4)-3 requirements. Tax treatment of solicitor compensation for the RIA is generally ordinary income subject to standard self-employment or business income rules.
How does HYV's RIA partnership program work?
High Yield Vault's RIA Partnership Program operates with full SEC Rule 206(4)-3 compliance infrastructure — written Solicitor Agreement template, Form ADV Part 2A Item 14 update language, eight-document compliance packet covering suitability and recordkeeping, and dedicated partnership team supporting accredited client onboarding through the six-step workflow. Partnered RIAs receive the full institutional diligence framework on every opportunity, including independent LE underwriting from recognized firms, AM Best A-rated carrier focus, and full five-tier operational servicing infrastructure. Across 21 years of practice and 438 accredited investors served, this partnership model has anchored HYV's direct-ownership platform — connecting fiduciary advisors with institutional-grade life settlement allocations for their accredited clientele.
