The Life Insurance Settlement Process

Purchasing a life insurance policy makes a great deal of sense. It offers protection for your loved ones and peace of mind in the face of your untimely death. However, it is also a long-term financial commitment.

Ultimately, you may find that your need for a life insurance policy ends at some point, or that you simply no longer want to make the payments. Rather than allowing your policy to lapse and letting the insurance company pocket the premiums you have paid over time, you may consider selling your life insurance policy.

This process is called a life insurance settlement, and it can be highly beneficial. However, there are many things you need to know about how the process works.

Working with a Trusted Life Settlement Broker is Important

One of the first things to understand about the life insurance settlement process is that you can work with buyers on your own. It is possible to connect with “providers” without outside help.

However, this is not advisable, as it can be very difficult to vet potential life insurance buyers, and even more difficult to entertain multiple offers. This leaves you with few options, and can easily result in you receiving far less for your policy than you should.

With a trusted life settlement broker, you have an experienced expert on your side who will solicit multiple bids from licensed, qualified buyers and help ensure that you get the best possible deal.

With that said, make sure that the broker’s license is valid in your state, and that they have a reputation for adhering to state and federal laws, as well as HIPAA regulations.

Know the Factors That Affect How Much You Receive When Selling Life Insurance

While selling a life insurance policy can allow you access to capital to improve your quality of life and meet your financial obligations, a number of factors can affect how much you’re able to receive from a life insurance buyer. These include the value of the death benefit, your current life expectancy and level of health, how much the buyer can expect to pay in premiums over time, and more.

It’s also important to note that some or all of the money received from a life insurance settlement may be taxed by the federal or state government. Because of this, it’s vital that you work with a trusted financial advisor or tax specialist.

Loss of Coverage

If you sell your life insurance policy, it’s important to understand that you will no longer have that coverage. You will no longer be the policy owner, and your previously designated beneficiaries will no longer be named on the policy. Instead, the buyer will own the policy and will receive the death benefit when you pass away. Think carefully about selling your insurance if you suspect that you will still need coverage in the coming years.

Consider Options

Be aware that there are several life insurance settlement options to choose from. Consider all avenues you can take when selling your current policy.

Watch for Fees and Hidden Charges

Most life settlement companies work on a commission basis. However, high commission rates, hidden fees and charges, and other costs can eat into the amount you receive when you sell your life insurance. Know exactly what the commission rate is and whether or not there will be any additional charges or fees tacked on. This is why it is so important to work with a transparent life settlement broker that you can trust.

Moving Forward

When it comes to life settlements, we are proud of the reputation of honesty, integrity and transparency that we have built with our clients. As a reputable life settlement broker, we work on your behalf to ensure that you receive the most money possible for your policy, and we never solicit any hidden fees or charges.

We invite you to contact us today to learn more about how we can help you gain peace of mind, financial freedom and a fulfilling retirement through a lucrative life settlement.