Understanding Settlement Options

Viatical and life settlements allow a life insurance policy owner to sell an existing policy to a financial institution in exchange for an immediate lump sum cash settlement.  The amount paid for the policy is a discounted percentage of the policy's net death benefit and represents the present day value of the policy.

The viatical or life settlement purchase price is determined by considering the insured's estimated life expectancy and the cost of premiums to keep the policy in force for that timeframe. The percentage of the face amount paid for each policy is determined by the insured's life expectancy and the premium obligation the settlement provider will assume over the insured's life expectancy. The purchaser of the policy becomes the policy's owner and beneficiary, as well they become responsible for all future premiums.

Life Insurance Used as an Asset

Life insurance policies are an asset. Policy owners have the right to sell it, just like any other asset. All types of policies are eligible for purchase, including universal life, variable universal life, FEGLI, group, term, and whole life. Each year, billions of dollars worth of policies eligible for purchase either are allowed to lapse or are surrendered. This is due largely to the public's lack of knowledge of this financial option. Financial service professionals have done little to educate themselves and their clientele about the usefulness of the viatical and life settlement transaction.

Regardless of terminology, the existence of both viatical and life settlements has changed the liquidity of the life insurance contract. This in turn has spurred the growth of accelerated benefit options offered by insurers to their own terminally ill policyholders. More details About Life Settlements and Viatical Settlements Options...

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Life Settlement INdustry News 06/20/05

Life Settlements and Real Estate Investing Cash from Life Settlements can boost real estate holdings.Many seniors do not realize that there are no restrictions on the use of their Life Settlement proceeds...

More About Premium Financing
04/26/05

Premium Financing. Affluent insureds can use leverage to buy life insurance using recourse and non-recourse premium financing. After two years, the coverage may be sold as a Life Settlement, or retained....

More About Premium Financing Life Settlement Questions Call 1-877-224-2200
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