A Universal Life Insurance policy was originally purchased to provide your family with financial security and income protection, but as you have reached your senior years you may have noticed your life insurance premiums have increased, or your need for life insurance is no longer the same as it was when you originally purchased the life insurance. You may have questions about how to best proceed with your universal life insurance policy.
What happens if you no longer need the life insurance coverage, or if the increased cost of 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 only the cash surrender value, and that is only if a cash surrender value exists. The policy may have a cash surrender value of zero.
Did you know that you can sell a universal life policy as a life settlement and get up more cash for the policy than if you surrendered to the carrier? Did you know that selling a life insurance policy is a fast, simple, no obligation process that could turn your unneeded or unaffordable life insurance policy into cash you could use to fund your retirement, invest in new ventures, pay off medical debt, create trust funds for your grandkids, travel, or set money aside for the future.
If you are age 70 or older your universal life insurance policy may qualify for a life settlement. That same $1,000,000 universal life insurance policy that you are considering surrendering may actually have value, and a lot of value. While many factors must be met to sell a life insurance policy for cash, more and more individuals over age 70 are finding the financial benefits in selling a universal life insurance policy instead of lapsing. A life settlement may be the best option available that you never knew about.
In many instances, individuals selling their universal life 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 universal life insurance 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 universal 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 universal life insurance 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.
When an individual decides to purchase a universal life insurance policy they expect to pay a set premium amount for life. Unfortunately the concept of a universal life policy has backfired for many seniors. According to an article in the Wall Street Journal, the universal life insurance sensation of the 1980s and 1990s was designed to offer life insurance and a savings account that earns income to help pay future costs and keep premiums the same for life. At the time interest rates were high so they could drive up the savings accounts. Today the same rates are at all time lows so the savings accounts are not generating the returns needed for seniors to keep the premiums the as illustrated. The result is seniors being hit with skyrocketing premiums without the ability to pay the increased costs. A life settlement on a universal life policy may be the right financial solution instead of lapsing the policy.
Some policy owners bought universal life policies to replace income for the family in the time of passing of the insured. Others bought universal life policies to offset any estate taxes that would impact the family. For both reasons, and others, your life insurance policy may no longer be needed. Your family may no longer need the income protection, or your children are grown and successful in their own families. If you originally purchased a policy for estate tax protection, the estate tax exemptions have changed drastically since 2000, going from only $675,000 of exemption in 2001 to a whopping $11.58 Million in 2020. The same life insurance policy is no longer needed because there may be no estate tax liability.
The opportunity to sell a universal life insurance policy for cash has opened a new financial option for policy owners who planned on surrendering their life insurance policy. Now by selling their universal 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 universal life insurance policy varies and depends on a number of factors including: death benefit, current and illustrated 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 universal life policies by Life Policy Solutions, a life settlement broker in California, show a wide range of life settlement offers.
For example, an 83 year old female, with relatively good health, sold a $2.5 million universal life insurance that they planned on lapsing for $490,000. The same policy would have resulted in no money if they had cancelled or surrendered the policy back to the life insurance company.
A 70 year old female, in declining health sold a $10 million dollar second to die universal life policy for a combination of both cash and retained death benefit. The family still wanted to retain some life insurance coverage so the policy was sold for $6,000,000 in retained death benefit payable to the family at passing, plus they received $350,000 in cash at time of closing. The total sale of the $10,000,000 policy was $6,350,000.
A 78 year old male in very good health for his age sold a $6 million dollar universal life policy for $600,000, which was 10 times more than the carrier was offering in cash surrender value.
A 92 year old female in declining health had a $5 million dollar universal life policy with increasing premiums that became unaffordable sold the policy for $2,200,000 which was used to help pay increasing living expenses and medical care.
To receive an instant life settlement estimate on your universal life insurance policy click here.
Once you make the decision to explore selling your universal 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
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.
Some policy owners may chose to explore selling a life insurance policy directly to a life settlement company, however 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 universal 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, such as Life Policy Solutions will help you truly maximize the value of selling a universal life policy.
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 universal life insurance policy can be a very valuable financial option and should be thoroughly 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