Life Insurance Settlements Provide Additional Choices
Life insurance settlements and viaticals can provide a second choice to seniors who no longer want or need their life insurance. This choice is often exercised after retirement comes, when protecting survivors from premature death takes a back seat to more pressing financial concerns such as maintaining a standard of living, assuring income longevity, and transitioning to alternative income sources.
Proceeds From Life Insurance Settlements Can Provide a Windfall Over Cash Values
Until life insurance settlements (otherwise known as senior life settlements) became available, a senior's only alternative to continuing an unwanted, unneeded, or unaffordable life insurance policy was to return it to the life insurance company that issued the policy in return for the policy's cash surrender value. On average, the policy owner received the cash value which only amounted to between 3% and 5% of the death benefit. In the case of term life insurance policies, they received nothing.
Life insurance settlements, on the other hand, provide an important additional option for seniors since the average amount received from life insurance settlements amounts to 3.5 times the policy's cash value. For term policies (which are otherwise worthless upon termination) the entire amount received from a life settlement can be considered "found money".
The Amounts Payable for Life Insurance Settlements Often Vary
Although 3.5 times the cash value represents the average amount received for life insurance settlements, exactly how much each individual policy will bring depends on several factors. The primary factors are the life expectancy of the person who is insured by the policy, the death benefit of the policy, the amount of the premium investors will have to pay to keep the policy in force until the insured's death, and the rate of return the investor expects to receive on their lump sum payment to acquire the policy and all future premium outlays.
Life settlement companies use sophisticated actuarial models to take these factors and others into account before making an offer for a potential life settlement policy. Experienced life settlement brokers use similar actuarial models to determine the amount they can actually sell a life insurance policy for.
Many Seniors are Still Unaware of Life Insurance Settlements
It might seem like anyone with an unwanted policy would take advantage of an alternative that could provide 3.5 times the amount of any other option, but that is not always the case. Even though policy owners have had a legal right to sell a life insurance policy for almost a century, very few have taken advantage of this opportunity, mostly because they are unaware it exists. A number of factors have contributed to this crisis of the uninformed, including the fact that when policy owners no longer want to keep their policy their first call is usually to their insurance company. Unfortunately, companies often discourage their personnel from telling customers they may realize greater payoffs on their policies by utilizing life insurance settlements instead of cash surrendering them.
Despite Benefits, Life Insurance Settlements are Not for Everyone
Life insurance settlements are nearly always a better alternative to cash surrendering policies for a lesser amount. But, they may not always be the best overall option for policies that are unwanted, unneeded, or unaffordable. To know when life insurance settlements are in your best you first need to identify your concerns and priorities. Then access the right information to make the right choices.
Get Complete Information About Life Insurance Settlements
The information section of our website will provide you with commonly known information pertaining to life insurance settlements. In addition, it is our intention to provide you with unique additional information so you can better utilize life insurance settlements in ways that compliment your overall financial priorities and concerns.
We Provide a Number of Life Insurance Settlement Resources
To accomplish our purpose, we regularly provide you with up to date information through our blog and a growing list of other resources.
Take a Holistic Approach to Life Insurance Settlements
Policysettlement.com is committed to utilizing an objective holistic approach to life insurance settlements by taking into account each individual client's unique financial circumstances and prioritized concerns before making a final recommendation. Providing you with as much information as possible and seeing things from your perspective enables us to work with you to determine if you should consider life insurance settlements now, later, or never. During the entire life settlement process we strive to provide unrivaled accessibility, transparency, and integrity.
