The legal basis supporting Life Insurance Settlements was established by the United States Supreme Court in 1911 in the case of Grigsby vs Russell.
The court’s decision is referenced whenever anyone questions the seemingly peculiar idea of selling a life insurance policy.
The Supreme Court’s ruling is fundamental to helping people realize the benefit of an investment they thought would only accrue after death. Justice Oliver Wendell Holmes, Jr., a keen legal scholar, understood the important relationship between the law and economics.
In Grigsby, a man named Burchard took out a life insurance policy, made two premium payments, was late on the third and, needing surgery but having no money, sold the policy for $100 to his doctor, Grigsby. After time passed, the policy matured (i.e., Burchard died and the administrators of the insured’s estate sought to recover the insurance payout from its beneficiary, Dr. Grigsby
In his opinion, Justice Holmes wrote, “….life insurance has become in our days one of the best recognized forms of investment and self-compelled saving. So far as reasonable safety permits, it is desirable to give life policies the ordinary characteristics of property.”
Fortunately, Burchard invested in an insurance asset he could sell (one worth almost $2,500 today, adjusted for inflation since 1911) and was therefore able to enhance or prolong his life by having his surgery.
Fast forward to today, do you find yourself in one or more of the following situations?
- Have your children grown up and there is really no need to pass on a death benefit to the children at your death?
- Are you retired and no longer need income replacement for a surviving spouse and having an influx of cash from selling your life insurance policy would enhance your retirement income?
- You can no longer afford the premiums for your policy and you don’t want to simply walk away from a policy you paid thousands of dollars for over the years?
- Your needs have changed from a fear of dying to soon to a fear of living to long past the time when your current assets may be spent.
If you find yourself facing one or more of these situations, please contact us today! There are no costs or fees to you!
Dan A. Penning
Life Insurance Settlements Specialist
Professional Life Settlements Plus
