Selling Your Life Insurance Policy-Understanding Viatical Settlements.


What is a Viatical Settlement?  A viatical settlement is the sale of a life insurance policy to a third party. The owner (viator) of the life insurance policy sells the policy for an immediate cash benefit. The buyer (the viatical settlement provider) becomes the new owner of the life insurance policy, pays future premiums, and collects the death benefit when the insured dies. At one time, most viatical settlements were from people with a life-threatening illness. Now, individuals who are not facing a health crisis may sell their life insurance policies to get cash.

Consider Your Options

If you’re selling your policy to get cash to pay expenses, check all of your options. You may find a way to get more cash from your life insurance policy.

1. Ask your insurance agent or company if you have any cash value in your life insurance policy. You may be able to use some of the cash value to meet your immediate needs and keep your policy in force for your beneficiaries. You may also be able to use the cash value as security for a loan from a financial institution.

2. Find out if your life insurance policy has an accelerated death benefit. An accelerated death benefit typically pays some of the policy’s death benefit before the insured dies. It may be a way for you to get cash from a policy without selling it to a third party.

Questions to Ask

• Do I still need life insurance protection?

• If I sell my policy, how do they decide how much cash I get?

• Is this an employer or other group policy? If so, do I need permission to sell it?

• If I sell my policy, who will be the legal owner?

• Do I need the advice of a tax or estate planning advisor before I decide to sell my policy?

• Who will have specific information about me, my family or my health status?

• After I sell my policy, can it be resold by the buyer?


That’s why Life Settlements Exchangee, LLC, was formed in 2015 to address the growing problem of double pre-life settlement funding for the same case (or client). This problem arises when a client applies for multiple pre- life settlement funding from different funding companies. Life Settlements Exchange, LLC solves this problem for all participating companies.

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