Like most insureds, people buy life insurance and put it in their safe deposit boxes for safe keeping, but selling your life insurance policy may be the only way a benefit will ever be paid! Nothing could be farther from the truth. Life carriers began pricing policies on a “lapse supported pricing model” over twenty years ago. What the heck is that? To start 90% of all policies purchased lapse before the death of the insured. With this fact in mind the carriers can artificially price a policy knowing full well the odds are on their side that the contract will expire before the insured. So what can you do to protect yourself? Go to your safe deposit box, dust off those policies and seek the aid of a seasoned insurance professional to get updated financial information from the issuing carrier and see if selling your insurance policy is an option. Don’t wait for them to come to you. Most states only require lapse notices to be sent out 60 days before the lapse date when premiums due are out of sight! Insurance professionals know where, when, and how to get the information from the carriers. Plus, they can explain the information to you. Considering 90% of the time you have a policy that will expire before you are scheduled to what do you do? Consider allowing the insurance professional to explore selling your life insurance policy in the secondary market for considerably more that what the insurance carrier is willing to pay in a cash surrender.
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