In the early years Life Insurance is normally bought to protect a mortgage, income replacement due to an untimely death, children’s education, and the list goes on.  But, when the golden years arrive, there’s a realization that life has changed, and needs have also.

The Life Insurance purchased earlier in life no longer fits.  The mortgage is paid off, the children are educated and have moved out – they have children of their own now.  Estate laws have changed and there’s no need for a large Life Insurance policy to pay estate taxes.  The Life Insurance that was so desperately needed is no longer, needed, or wanted.  In addition, it may be unaffordable.

Over the years our nation’s economy has impacted the lives of many seniors.  Both baby boomers and seniors are looking for ways to liquidate assets.  Life Settlement offers a reasonable and profitable exit strategy for policy owners.

A Life Insurance policy is an asset.  This basic premise was established in Grigsby vs. Russell in 1911.  This case established a Life Insurance policy as private property, which can be assigned at the will of the owner.  In other words, a Life Insurance policy is an asset just like a house or a car and can be sold just like a house or a car.

A Life Settlement is the sale of an existing in-force life insurance policy, on a insured whose life expectancy is greater than 2 years (not terminally ill), to a third party for an amount greater than the cash surrender value.

The policyowner receives cash for the policy

The new owner becomes responsible for all future premium payments

The new owner becomes the beneficiary of the policy

At the death of the insured, the death benefit is paid to the new owner.

A Life Insurance policy is normally the second most valuable asset a person will ever own.  A house is the most valuable acquired by American’s.  Over 90% of all insurance policies lapse and death claims are never paid.  People don’t realize that Life Settlement is an option.  The maturity of the Settlement market is driving greater awareness and use as a financial tool.

For example, Life Settlement is being used to help with the Long Term Care crises in America.  Some states are allowing the proceeds from a Life Settlement to be used for Long Term Care.  This is keeping tens of thousands of people off Medicaid and creating millions of dollars in savings for Medicaid.

Life Settlement allows for policy owners to tap previously unrealized value in their unwanted, unaffordable, or underperforming Life Insurance policies.  This asset can be liquidated for fair market value and the proceeds redistributed to address current financial planning goals such as retirement income, long term care, annuity, vacation or anyway you please.

Life Settlement is another option which allows for policy owners to tap previously unrealized value in their unwanted, unaffordable, or under-performing Life Insurance policies.  The value of a Life Insurance policy is calculated based on many varied factors.  Some of the most common components are:  age, health status, death benefit about, annual premium and try of policy.  There are fees involved but they are normally paid by the buyer.

A Life Insurance policy can be liquidated for fair market value and the proceeds redistributed to address current financial planning goals such as retirement income, long term care, annuity, vacation or anyway you please.  The proceeds may be taxable.  A tax adviser or attorney should be consult on taxable issues.

Qualification is an important step because Life Settlement is not the right choice for everyone 65 and over who has a $250,000 insurance policy. There are many variables that determine the value of a Life Settlement. Expectations should be discussed in the Qualifying process.