Your term life insurance policy was originally purchased to provide your family with financial security and income protection, but now you are nearing the end of the level term period and you have questions about how to best proceed with your life insurance policy.
You may have received paperwork in the mail from the life insurance company asking you to convert the term insurance policy into a permanent life insurance policy, such as a universal life policy, which will continue your coverage at an increased level premium for the remainder of your life. The insurance company may have also provided the estimated premium payments to convert the policy.
What happens if you no longer need the life insurance coverage, or if the estimated conversion premiums are no longer affordable? If you surrender the life insurance policy back to the insurance company you will lose the death benefit and receive no money back.
Did you know that you can sell the term policy as a life settlement and get cash now?
If you are age 63 or older and your term life insurance policy is still within the conversion period you may qualify for a life settlement. That same $500,000 term life insurance policy that you are considering surrendering may actually have value. While many factors must be met to sell a life insurance policy for cash, more and more individuals over age 63 are finding the financial benefits in selling their term life insurance policy instead of lapsing.
In many instances, individuals selling their term policy are able to receive most, if not all, premiums paid in back. Not all policies will qualify to be sold as a life settlement, but before surrendering the term policy, or letting it lapse, it may be in your best interest to explore if a life settlement option is available.
Now let’s learn about how to sell my term life insurance policy?
A life settlement is a financial transaction that involves a policy owner selling a life insurance policy to an investor, sometimes referred to as a life settlement provider, or life settlement company.
In exchange for selling a life insurance policy, the policy owner receives a cash payment today, which is a percentage of the current death benefit.
The investor will assume all future beneficiary rights and ownership to the life insurance policy, including rights to the death benefit. It will be the investor’s responsibility to maintain all premiums moving forward.
There are many reasons why an individual considers selling a term policy as a life settlement. The two most popular reasons to sell a life insurance policy are the premiums are too expensive and I no longer need life insurance coverage. Both reasons present an opportunity to explore if a life settlement is an option for your life insurance policy.
Term life insurance policies are widely obtained because you can receive maximum insurance coverage at a low cost for a set period of time. The coverage provides income and family protection without the high costs of permanent insurance products. However, those low term costs will only last a set period of time, usually 10,20, or 30 years. After the term expires, the premiums will being to increase annually each year. Most term policies can be converted into a permanent insurance policy and continue for life, but the premium is significantly higher than you paid for the term coverage. For these reasons most individuals opt to cancel, or surrender, their term life coverage when the term period ends.
Recently, life settlement companies have been offering to purchase term life insurance policies that meet certain criteria, most importantly, the policy be within the conversion period, and the insured be over the age of 63. There are many other very important factors that must be met for a policy to have a life settlement value, such as policy size, premium cost, and insured’s health.
The opportunity to sell a term policy for cash has opened a new financial option for policy owners who planned on surrendering their term policy. Now by selling their term life insurance policy as a life settlement, policy owners can create more retirement income, pay for long term care, invest, or even pay off debt.
To get immediate assistance with selling a term life insurance policy and learning if you qualify for a life settlement contact Life Policy Solutions at 844-440-7355, or visit www.CashOutLifeInsurance.com
The amount you can receive from selling a term life insurance policy varies and depends on a number of factors including: death benefit, current and conversion premiums, the insured’s health, and the current market. A life settlement broker can help guide policy owners looking to sell their insurance policy by representing the policy, for a fee, to a wide network of financially capable and licensed life settlement buyers.
A few examples of previously sold term policies by Life Policy Solutions, a life settlement broker in California, show a wide range of life settlement offers.
For example, a senior couple age 73 and 74, with relatively good health, sold a $4 million term life insurance that they planned on lapsing for $275,000. The same policy would have resulted in no money if they had cancelled or surrendered the policy back to the life insurance company.
A young, 63 year old, very healthy male recently sold a $1 million term life insurance policy with relatively low conversion premiums for $20,000, and a 68 year old female with a few health impairments sold a $250,000 term policy, still in the conversion period, for $18,000.
On the far end of the spectrum, a 59 year old male with a terminal illness was able to sell a $1 million term policy that was no longer available for conversion and had increasing premiums, for $575,000. While this last example is rare, the goal is to show that selling a term policy can be a very valuable financial tool that is worth exploring before the policy is surrendered or lapsed.
To receive an instant life settlement estimate on your term life insurance policy click here.
Once you make the decision to explore selling your term life insurance policy, you will need to gather your life insurance policy information. If you do not have a physical copy of your life insurance policy, you can request a new copy from the life insurance carrier directly, or contact your life insurance agent.
Many websites have a life settlement application you can complete. You can also call a life settlement company or life settlement broker directly.
You will need to know the following information:
• Policy Face Amount, or Death Benefit
• Insured’s name, if different from policy owner
• Premium cost
• Premium Frequency
• State the policy is issued in
• Is the term policy still within the conversion period
You should also be prepared to provide a brief summary of the insured’s health to the life settlement broker or life settlement company.
To learn more about How To Sell A Life Insurance Policy visit our informative article here.
The short answer is absolutely!
While some policy owners may chose to explore selling a life insurance policy directly to a life settlement company, it is recommended that they consider working with a life settlement broker. A life settlement broker, for a fee, represents the sale of a life insurance policy to a network of buyers. A life settlement broker not only provides policy owners with guidance and expertise, but more importantly they have the experience and relationships with buyers in order to maximize the true potential value of a term life insurance policy.
• Life Settlement Brokers can provide guidance and education to policy owners throughout the life settlement process, from inquiry to close of sale.
• Life Settlement Brokers work first and foremost for the policy owner, not for the buyer.
• Life Settlement Brokers have an obligation to help policy owners review and understand all offers, the funding source, the overall gain from the sale, tax concerns, and privacy issues that may arise from the sale.
• Life Settlement Brokers can present a policy to multiple buyers at the same time, maximizing the true potential value of the policy.
• Life Settlement Brokers have the ability through experience and relationships, to navigate the best offers and best life settlement companies to sell to.
• In most states, working as a life settlement broker requires a license, and brokers must take continuing education courses.
A life settlement broker can only help you when looking to sell a term life insurance policy and maximize it’s value.
To learn more about Who A Life Settlement Broker Represents, click here
To learn about the 10 Best Life Settlement Companies compiled by Life Policy Solutions, click here
Qualifying for a life settlement is fast and easy. You can learn about life settlements and qualify directly through a website or via phone. There is a large network of both life settlement companies and life settlement brokers available to guide you through the life settlement process. In addition, the Life Insurance Settlement Association is a wonderful resource that provides guidance and information to help you navigate and learn if a life settlement is the right option.
There are 4 key steps to Qualify for a life settlement:
Step 1 – Do You Meet The Criteria?
Step 2 – Gather Your Policy Information
Step 3 – Consult with a Life Settlement Broker (recommended)
Step 4 – Ask Questions and Explore All Options
Selling a term life insurance policy can be a valuable financial option and should be explored before deciding to cancel, or surrender, the policy back to the life insurance company. There are excellent resources and individuals in the life settlement industry to help answer all of your life settlement questions.
To get immediate assistance with selling a life insurance policy and learning if you qualify contact Life Policy Solutions at 844-440-7355, or visit www.CashOutLifeInsurance.com