Life Settlements

Every day thousands of older (over age 65) policyholders are lapsing or surrendering term or permanent life insurance policies that they have had for years, either because they believe they no longer require the coverage, or because they no longer can afford to pay the premiums.

  • If they permit the policy to lapse they get back nothing.
  • If they surrender the policy to the insurance company, in many cases they receive far less than the policy is worth.
  • Some of your clients may have outlived their need for some of the life insurance policies that they purchased years ago.
  • Some of your clients may prefer to stop paying premiums for life insurance that they no longer can afford.

When should your consider suggesting a Life Settlement to your client?

  • When the insured is 65 years if age or older.
  • When the face amount is $100,000 or more.
  • When a policy is lapsing or about to be surrendered.
  • When there is a need for Income or for Long Term Care.
  • When the insured has outlived the beneficiaries.
  • When there is a material change in the health of the insured.
  • When a key man is retiring or a company is selling.
  • When the policy is no longer needed.
  • When there is a serious need for additional income.

We frequently receive questions from agents as to what type of policies are currently receiving solid offers in the secondary market. Here is a sampling of a few of the policies that have recently received accepted offers:

FRED, an 88 year old man with carotid artery disease who needed money.
$1,000,500 policy issued 12 years ago. Cash surrender value $260,000.
Gross offer:  $650,000.

JAKE, an 84 year old with abnormal EKGs who could no longer afford the premiums.
$2,000,000 policy issued four years ago. No Cash surrender value.
Gross offer: $220,000.

PHIL, 76 years old, coronary artery disease, can no longer afford the premiums.
$1,400,000 policy issued 10 years ago. No cash surrender value.
Gross offer: $85,000.

These three sales produced more than $500,000 above the Cash Surrender Values to the policy owners. A win for them. A win for the agents as well.  These were all difficult cases and could only have been accomplished by experienced life insurance experts.