Questions About Selling Your Life Insurance Policy?

There are many reasons to sell a life insurance policy.

For example:

• The original purpose (like protecting a spouse, kids, or a mortgage) no longer applies

• The policy has become too expensive to maintain

• The funds could be better used for retirement, healthcare, caregiving, or other personal goals

Most people don’t realize that you don’t have to let your policy go for nothing. In many cases, you can sell it for cash—sometimes tens or even hundreds of thousands of dollars more than the surrender value.

A life settlement is the legal sale of a life insurance policy to a third-party buyer (usually an institutional investor).

Here’s how it works:

• The buyer pays you a lump sum cash paymen

• tThey take over premium payments

• They become the new owner and receive the death benefit when the time comes

Most types of life insurance may qualify, including

• :Universal life (most common)

• Whole life

• Convertible term (especially valuable)

• Some group policies

• Joint policies (like second-to-die or first-to-die)

Even if your policy is a term policy or you’re unsure about the type, it’s worth asking. If it can be converted to a permanent policy, it could still qualify.

The payout depends on:

• Your age and health

• The type and size of the policy

• How much longer premiums need to be paid

On average, people receive 4 to 6 times more than they would by surrendering the policy to the insurance company.

We’ve seen clients who were about to lapse their policy receive offers of $50,000, $250,000—even $1 million.

No. While having health issues can make your policy more valuable, you do not need to be terminally ill.

• Seniors in their 70s or 80s may qualify even if relatively healthy

• Younger individuals (in their 50s or 60s) often qualify if there are significant health changes

• Some buyers specialize in healthier individuals with convertible term policies

Most buyers look for policies with at least $100,000 in face value, but exceptions can be made based on age and health.

If you’re not sure whether your policy qualifies, we can do a free, no-obligation review.

Yes. In fact, the right to sell your life insurance policy was established by the U.S. Supreme Court over 100 years ago.

Today, life settlements are regulated in 43+ states, covering over 90% of the U.S. population.

Regulations ensure:

• You receive proper disclosures

• Licensed buyers are involved

• Physicians and beneficiaries may provide sign-offs

• The entire process is transparent and secure

We work as a fiduciary broker, meaning we work for you, not the buyer. We’ll bring your case to multiple buyers to secure the best possible offer.

No. If you sell your policy, the buyer becomes the new beneficiary. However, you receive a lump sum payout now, which you can use however you choose—whether that’s helping family now, covering medical expenses, funding retirement, or just enjoying life.

Some families prefer the financial flexibility of a settlement over a future death benefit that may never be needed.

• Loss of future death benefit: Once sold, your family won’t receive the payout later

• Tax implications: Depending on your situation, some portion of the payout may be taxable (we recommend speaking with a tax advisor)

• Impact on benefits: In rare cases, the cash could affect eligibility for Medicaid or SSI

We walk through all of this with you before any decision is made. Our goal is to educate—not pressure.

We make it simple:

• Submit a short form with some basic information

• We’ll review your policy and tell you if it qualifies

• If it does, we’ll bring your case to multiple buyers and let you know the best offer

Insurance companies often don't promote life settlements because they can reduce their profits. When a policy is surrendered or lapses, insurers retain the premiums paid without disbursing a death benefit. In contrast, a life settlement involves a third-party purchase, which can be more beneficial for the policyholder but less so for the insurer.