Life settlements create immediate liquidity from a non-performing asset from the sale of an existing life insurance policy to a settlement provider for a percentage of the policy's face amount; to be precise, we should say, the Net Death Benefit, after deduction of outstanding loans. This allows policy owners to cash out of unwanted, unaffordable or obsolete life insurance policies insuring a those over age 65.
Whether you call it a senior settlement, lifetime settlement, or high net worth transaction, life settlements have become a very important factor in the estate planning process. Prior to the life settlement industry, if a senior owned a policy that was no longer needed or affordable, the only option was to lapse, cancel, or surrender the policy back to the carrier for the cash surrender value. Life settlements allow qualified policy owners to liquidate a policy for an amount much higher than the cash surrender value.
It's important to remember that a life settlement is defined as the sale of a policy for a discounted percentage of the death benefit. Therefore, policies with low cash surrender values or policies with no value are purchased most often. When the cash surrender value is a high percentage of the death benefit, it more difficult for the settlement provider to beat the cash surrender value.
Creates current liquidity from an otherwise dormant asset.
Provides funds that can be reinvested in other financial vehicles.
Eliminates costly premium payments on a policy that is no longer wanted or needed.
Allows clients to receive more than the cash surrender value of a policy.
Provides a tax-efficient solution.
Offers Reinvestment Opportunities.
Funds the purchase of a survivorship policy.
Funds a deferred compensation program.
Enables the possibility to buy back stock from a business partner.
Pays for long-term care insurance or other asset-protection tools.
Additional Information About Viatical Settlements
|Not Registered In Texas|
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