Life Settlements
Sell your life insurance policy, for cash
What is a life settlement? A life settlement is an agreement between a policyholder (you) and a financial institution. In this agreement the policyholder sells the policy ownership rights to the financial institution for a cash payment. That payment will always be more than the cash surrender value of the policy, thus providing the policyholder with immediate liquidity for the unrealized equity in the life insurance policy.
Why sell your policy? There are many reasons why you would consider selling your policy. The most obvious reasons are that you no longer have a need for the protection or can no longer afford the coverage, yet you wish to recover the monies that you have spent keeping the policy in force over the years.
Selling a policy may also be of interest even if you still need protection but want to take advantage of more modern product design with lower cost. In many situations you may be able to sell an existing policy and purchase a replacement policy of equal or greater benefit for less money. We have helped people acquire a settlement in order to help pay for health care, fund a charitable donation, or supplement their retirement.
Life settlements are typically designed for individuals who are 65 and older, who may or may not have health-related issues. If you are curious about whether you or your parents are eligible for a life settlement, please contact us today.
Life Settlement Case Studies
Cash Surrender
Male : 79 years old : Universal Life
| Face Amount | $1,000,000 |
| Cash surrender value offered by insurance carrier |
$1,022.68 |
| Net to Policy Owner from life settlement |
$425,000 |
| Value Created | 41,557 % |
Motivation for Sale:
Both insured/owner and beneficiaries did not want to pay on-going
premiums. Rather than surrender the policy to an insurance company for
an immaterial value, the client chose to sell the policy on the
secondary market, and disperse the funds to his children.
Estate Planning
Male : 74 years old : Whole Life
| Face Amount | $3,500,000 |
| Cash surrender value offered by insurance carrier | $273,873 |
| Net to Policy Owner from life settlement | $1,190,000 |
| Value Created | 435 % |
Motivation for Sale:
The owner/insured had skillfully handled all potential estate planning
needs. It was determined that this policy was no longer needed and it
was sold for over 4 times the cash surrender value.
Business Needs
Male & Female : 80 years old : Survivorship
| Face Amount | $5,000,000 |
| Cash surrender value offered by insurance carrier | $23,816 |
| Net to Policy Owner from life settlement | $1,500,000 |
| Value Created | 6,298% |
Motivation for Sale:
The second generation running family business was confronting serious
cash flow issues. Parents/Founders of the company realized that the
policy would potentially lapse as a result of current business factors.
Rather than surrender the policy and still face a potentially
insurmountable financial situation, the policy owners sold the policy
and resolved all of these problems!
Quality of Life
Female : 52 years old : Term
| Face Amount | $2,000,000 |
| Cash surrender value offered by insurance carrier | $0 |
| Net to Policy Owner from life settlement | $750,000 |
Motivation for Sale:
Husband and wife decided that if they received a substantial value for
their policy they would rather travel with their children instead of
ultimately receiving the death benefit.
Policy Lapse
Male : 75 years old : Term
| Face Amount | $250,000 |
| Cash surrender value offered by insurance carrier | $0 |
| Net to Policy Owner from life settlement | $25,000 |
Motivation for Sale:
Insured could not afford conversion or annual renewable premiums, as a result the policy was going to lapse.
Key Man
Male : 76 years old : Term
| Face Amount | $10,000,000 |
| Cash surrender value offered by insurance carrier | $0 |
| Net to Policy Owner from life settlement | $2,750,000 |
Motivation for Sale:
Policy no longer needed due to retirement. Funds from sale were used to
purchase vacation home & long term care policies.
Charitable Giving
Female : 82 years old : Universal Life
| Face Amount | $5,000,000 |
| Cash surrender value offered by insurance carrier | $48,000 |
| Net to Policy Owner from life settlement | $1,200,000 |
| Value Created | 2,500% |
Motivation for Sale:
Insured was a key donor to a major university that needed funds to
underwrite current programs. Rather than wait to receive the death
benefit in the future, the insured and the university felt it was more
beneficial to utilize the sale of the policy to meet present day issues.