Senior Life Settlements – Getting Paid for Policies

Can you, or an older person you know, actually make a good cash settlement for an unwanted life policy? It is possible, and these days, life settlements have become popular.

The investors who buy the life insurance will be set as the new beneficiary. They also offer to make premium payments that are still owed. In return, they hope to collect on the death benefit. The insured person, on the other hand, gets paid now.

This can be an attractive option for many senior citizens who need money to live on, and are not as concerned about heirs who would get a death benefit later.

People used to have few options when they wanted to get rid of their life insurance. One option was to just stop paying so the policy would lapse. They may have been able to surrender it to the original insurer for a small cash value.

A better option, for people who qualify, is to find a life settlement.

Who qualifies?

Most of the time, the insured person must be at least 70 years old, though someimes a younger person will be considered.

Types of Life Insurance That Work

The life insurance policy must be whole or universal life insurance because that is permanent. Term may work with a guaranteed convertible rider.

If you have term with a convertible option, make sure you start shopping for a deal when you have time left on your policy.

Should seniors consider this?

This is not the best choice for all people, or for all families. But many people have been happy to take advantage of this way to raise cash.

You need to understand that the beneficiaries will give up any future death benefit. This really only works if those benefiaries are in agreement.

Business can also use this as a way to sell policies on employees who have retired or changed jobs. Instead of just letting the contract lapse, they can actually be paid cash. This can be a good use of a key man or business owners policy.

How much money can an insured person get?

Policy owners will probably be able to shop a market with many people competing for the right to buy. Some can get a pretty decent percentage of the face value (death benefit). It is not impossible to find offers of 1/2 or more of the face value.

How can a person find out more?

If you are interested, you can find brokers who will be able to help you find competitive cash offers.

I cannot tell you if you should sell your life insurance policy, but it is certainly something qualified people should think about.