Understanding Life Settlements: A Guide For Seniors

by Micheal M. I'm a professional Writer

A few decades ago, there weren’t that many options when it came to getting the maximum value off your life insurance policy you no longer needed. You could either surrender it for the cash surrender value, or get it terminated. The latter would happen if policy owners were unable to pay their premiums on time, causing the policy to lapse. If this happened, they couldn’t collect the cash surrender value.

However, you may have a new option when it comes to dealing with unmanageable or unneeded life insurance policies. You may be able to sell it for cash and forgo the rights to the death benefits it entails, by allowing a third party to purchase it off you. This financial transaction is called a life settlement.

Senior Life Settlement vs Viatical Settlement

Many people often confuse the two terms, thinking them to be the same. However, senior life settlements and viatical settlements are two different things.

Senior life settlement is actually just another term for life settlements, reserved for people typically over the age of 70. On the other hand, viatical settlements are reserved for older individuals who have a terminal illness and aren’t expected to survive for more than two years. Thus, seniors who don’t have a terminal illness opt for senior life settlements.

Why Should You Get a Life Settlement?

Due to a change in circumstances, you may find that you no longer want, need, or can afford a life insurance policy. If such a situation arises, it makes little sense to continue paying premiums, or be inconsistent with your payments only to have your life insurance claim revoked later. Moving toward a life settlement may be the best option in this case. Before you do this, however, ask yourself the following questions:

Do I still need my life insurance policy for its intended purpose?

One typically purchases life insurance policies if they have a financially dependent spouse or children. However, as time passes, your children (or spouse) may no longer need your financial assistance. Similarly, if your key beneficiary passes away, the policy isn’t necessary anymore.

Does your insurance policy still tie with the initial intended purposes you purchased it for? if your children or spouse are no longer financially dependent on you, it’s best to opt for a life settlement.

Does the policy complement my current needs?

Getting older does bring with it a couple of additional financial burdens. For instance, you may have long-term healthcare needs that are heavy on the pocket. Before you decide to sell your life insurance policy, assess your current needs.

Are you worried about future expenses, including the premium payments of your insurance policy? Are you fully prepared for retirement? Is the death benefit of your insurance policy of less significance than the upfront you’d get from selling it? Look at your current financial needs, see whether your policy still complements it, and proceed with life settlement if it doesn’t!

Prosperity Life Settlements is here to help you sell your life insurance for cash in your elderly years. They also offer a free life insurance settlement calculator.

Get in touch with the life insurance settlement brokers today to determine if you qualify for a senior life settlement.