Life Settlements Are Not Just For Large Policies

I am seeing more companies advertising life insurance settlements on TV, online, radio, etc. It raises visibility for the solution that life settlements can be, and I appreciate that. However, so many times, the examples given are very large offers, and for very large policies. Yes, the large offers cited are impressive, most likely because the clients have very significant health issues. Because of this, sometimes advisors mistakenly think that life settlements do not work for smaller policies or for healthier clients. Many people do not have high face value policies, and/or are relatively healthy. The reality is that life settlements are not just for large policies.

Do we market high face value policies? Of course, often. But the fact is, your clients more often than not, will have much smaller face value policies, and be relatively healthy, so this email is focused on case studies for the more typical types of policies that your clients may have.

Here are some recent success stories:

*$250,000 universal life policy - client is 74. The client no longer needed the policy, and wanted the cash to pay for their daughter's wedding. They went directly to a buyer, and received an offer. Then, they came to us. They received $47,000 for the policy - giving them $17,000 over cash surrender value, and 70% more than the buyer direct. When clients go direct to buyers, they usually undersell their policy, and the advisor is cut out.

*$200,000 universal life policy - client is 91. There is no cash in the policy, and the premium is $23,000 per year to carry the policy - too expensive for the client. The opening offer was $20,000. With multiple offers, and leveraging buyers against each other, the final offer was $80,000. Selling the policy allowed the client to receive money for the policy, where the surrender value was zero, and net $23,000 per year in additional cash flow from no more premium.

*$150,000 term policy - client is 78. This policy is an annual renewable term policy and is getting too expensive to maintain. We obtained an offer of $25,000 for the client, allowing them more funding for health care needs.

Please remember that term policies, especially if still convertible, are highly marketable, and we sell the policies of much younger clients as well. Each client's situation is different, so feel free to contact me any time to discuss your client's policy. We're here to help.