What is a Life Settlement?

Simply put, a life settlement is the sale of your life insurance policy. The seller receives a lump sum of cash, and the buyer collects the death benefit when the insured passes away. Once the policy is sold, the seller is no longer obligated to make the payments to the insurance company to keep the policy in place but instead that obligation falls on the buyer.

Why Would a Person Sell His or Her Life Insurance Policy?

If you are reading this article you have likely already made the initial decision that selling your life insurance policy is something you want to explore.  The policy that once provided you with security and comfort may no longer have a purpose but at the very same time, you have paid so much money to keep it in place you don’t want to just “give it up” to the life insurance company… that makes a lot of sense.  In our experience, the most common reasons a person sells their life insurance policy include.

  • You no longer need life insurance: Maybe your kids are grown up and independent, you are divorced or widowed, or you are simply in a different economic position. In all of these cases and many more, life insurance is now just an expense without a purpose.
  • The policy is just too expensive: If you can no longer afford to pay the premiums but you don’t want to just surrender the policy back to the life insurance company
  • You need money: A life insurance policy is a valuable asset for you and your family but sometimes, like many assets, the value is to sell the policy and get a lump sum of cash that you can put to use for other purposes

What is the Process of Selling Your
Life Insurance Policy?

You might be surprised by how easy it is to get a quote for your life insurance policy. Keep in mind that getting a quote is completely free and without any obligation. We assume all the costs and expenses of gathering the documentation and reports needed to provide you with a quote and then it’s completely in your discretion whether to proceed. Here is a quick (and general) overview of the steps:

1. Application: One of our friendly customer service team members will reach out to you to complete your application. That phone call should take 10 minutes or less.

2. Independent Life Expectancy Underwriting Report: After we complete the application with you, our team will submit your application to a third party that will complete an underwriting report on your health. As part of that process, they will likely want to talk with you and may ask your doctors for some or all of your medical records. Once they have all the information they need, they will prepare a report. You, of course, are welcome to see this report.

3. Buyers: Based on your report, we find buyers that are willing to make you an offer.

4. Balls in Your Court: Once you have an offer or multiple offers, you decide whether you want to go forward with selling. We recognize this is a significant decision and want you to be 100% confident you are making the right one.

5. Updating Records: If you decide to sell your life insurance policy, we work to get the records updated with your life insurance company

6. Funds Paid to You: Once we receive written verification of the change of ownership of the policy, the lump sum of cash is released to you. Please note that once you accept the offer the funds are paid to you only when your insurance company changes their records to reflect the new ownership of the policy. Just like the sale of a home, your funds are held in a third-party escrow account are released to you once change of ownership of your life insurance policy is confirmed.

Let's Explore If Selling
Your Policy Is a Good Option