Life Insurance Settlements Florida FL
Reader’s Question:
I’ve heard of viatical settlements but not life insurance settlements. How does this work?
Chad
Tampa, FL
With viatical settlements, a person who is terminally ill can sell his/her life insurance policy for portion of the face value of the policy. With life insurance settlements, also called senior settlements, a policyholder, although he/she is not terminally ill, can sell the life insurance policy. However, under this contract, the investor who will buy the life insurance policy will only pay a portion of the life insurance policy’s face amount rather than getting what the death benefits would have worth. The investor will then continue the payments for the life insurance policy and will also receive the full amount upon your death.
This is not the same as merely surrendering your life insurance policy. When you surrender the policy, this means that you are selling the policy back to the life insurance company for a cash value. Furthermore, the amount of money that you will be receiving from life insurance settlement is substantially higher than that from surrendering your life insurance policy to the life insurance company. Life insurance experts say that the value of life insurance settlements is higher than the cash value by 25%.
Tags: life insurance