What is a Life Settlement?
A life settlement is the sale of a life insurance policy to a third party called a life settlement provider. The owner of the life insurance policy sells the policy to the settlement provider and receives an immediate payment in return. The settlement provider becomes the new owner of the life insurance policy, pays any future premiums and receives the death benefit when the person whose life is insured under the policy (the insured) dies.
Life Settlements can offer consumers an estate planning solution that may often be overlooked. The challenge is to know how to identify a potential case and what steps are necessary to generate an offer.
When should you consider life settlements?
• If you are over the age of 70 and are considering surrendering or canceling a life insurance policy due to expensive premiums or being over-insured. Life settlements can oftentimes generate an offer 2-3 times the policy’s surrender value.
• If you are over the age of 70 and are seeking liquidity for the purpose of funding charitable initiatives, Long-Term Care Insurance or other investment opportunities.
• If you are over the age of 70 and are considering a 1035 exchange, then you should consider a Settlement.
One of the best times to identify if you can benefit from a Life Settlement is during an annual policy review. An annual review of a life insurance portfolio can often identify issues such as underfunded coverage, outdated coverage types, and/or insufficient coverage limits. Please call to discuss any potential opportunities.
We can pre-qualify a policy to determine the possible value before any forms or applications are submitted.