Life Insurance 101: What Your Policy Can do For You

What is a Life Settlement?

A life insurance policy is a personal asset that you can sell like any other asset.

A life settlement is the sale of an existing life insurance policy to a third-party purchaser for a mutually agreed upon price. In a life insurance settlement transaction, a seller transfers ownership of their policy to a purchaser. The amount received is typically substantially more than a policy’s cash surrender value but less than the death benefit.

In a life settlement transaction, the policy owner transfers ownership of the life insurance policy to the purchaser. The seller in a life settlement is only entitled to the agreed upon sale proceeds. As a result, the purchaser becomes responsible to pay the policy premiums and is also entitled to receive the death benefit when the insured passes away.

The proceeds received by the policy owner are largely tax free.

A life insurance settlement is not a “viatical settlement”. A viatical settlement is restricted to policy owners who are terminally or chronically ill. Viatical settlements are subject to different rules and procedures.

Consider these facts:

  • 200 Billion a year of life insurance goes uncollected based on lapsed policies.
  •  90% of Seniors who lapsed or surrendered their policy say they would have considered selling if they were made aware of the possibility.
  • More than 85% of universal policies never result in a death claim.
  • More than 30% of insureds age 65 and over own a life insurance policy with a market value through a sale greater than the surrender value as described in their insurance policy

Do you align with one or more the following circumstances?

  1. You have retired and no longer needs income replacement at death or his/her children are grown and no longer need protecting,
  2.  You sold your business and the key person policy is no longer needed, 
  3. You purchased the policy as part of an estate tax planning strategy which is no longer necessary, 
  4. You are retired and has encountered unexpected long term healthcare expenses,
  5. You simply want to obtain significant cash from a settlement to reinvest in something else or spend it!

There are no fees or costs to complete the  analysis of the information to determine the viability of a  life insurance settlement with Professional Life Settlements Plus. As a result, your decision to explore a settlement for the sale of a policy is at no financial risk to you.

If you are wondering whether a life settlement might be right for you contact us today!

Dan A. Penning

Life Settlements Specialist

Professional Life Settlements Plus

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