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Life settlements are the sale of a current life insurance
policy to a financial institution. Basically you sell your
life insurance policy for a percentage of the death benefit.
The purchaser becomes the owner and beneficiary of the
policy. They are an excellent resources for seniors, the
terminally ill, and corporations with with no longer needed
life insurance policies.
Viatical Settlement are for
terminally ill individuals that have life insurance.
Commonly terminally ill individuals sell their life
insurance policy to pay for better care, go on a vacation,
pay expenses, or they cannot
afford the premiums.
Senior Settlement are an
excellent option for seniors that are over the age of 65
years. Seniors qualify for a settlement is they have a life
expectancy of less than 10 years. Senior typically take part
because they have outlived the beneficiary of the policy,
cannot afford the premiums, or could better invest the
money.
Key man settlement are
specific to corporate owned life insurance. Corporations
sell life insurance policies because the insured key man has
retired and the policy is no longer needed, the loan that
required a life insurance policy is paid off, or the
corporation has a split dollar policy.
What does a Life Settlement Broker do?
A broker is the intermediary
between the insured and the funding companies. Brokers work
on behalf of the insured to make sure they receive the
highest offer the market provides. They also collect all of
the information required by the funding companies to develop
bid offers. A life settlement broker does not charge a fee
to clients they represent, instead they receive a commission
from the funding company for a successful settlement. This
commission does not affect the amount a client receives and
is based on the death benefit of the policy.
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