The senior life settlement refers to life insurance policies that are for sale or that have been sold to the secondary market. This market is made up of settlement providers that represent funds that invest in the purchase of many policies. A senior life settlement usually pertains to an insured of 74 years of age and up. The real criteria comes down to a life expectancy report of the insured. By releasing your medical history and in some cases a current exam, the funders will order a life expectancy report. This report along with your policy’s internal cost structures will position the policy for offers. The probability that you will live for a period of time is calculated by institutions that are authorized and approved by the funders to provide this service. The predominate value that is researched is the present value of the death benefit. In cases where a medical complication has occurred during the insured period creating perhaps for a lower life expectancy, the policy’s net present value can “skyrocket”. I have been involved in a case where a very healthy 76 year old male was issued a preferred rating on a $6,000,000 life insurance policy. Three years later he developed diabetes and while playing tennis in that same year he has a mild stroke. His financial position changed dramatically and he felt he no longer wished to have the policy. He was able to sell the policy for six times what he paid in premium. The senior life settlement can have high value to the owner/insured so I advise at a minimum that you must know the current value of your policy for settlement purposes so you can make the right decision.
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