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Selling Your Policy

The Basics

Financial needs change over time.
Many people find that as they reach retirement age, their life insurance is no longer useful.  It has served its primary purpose to protect loved ones. Their life insurance policy effectively became a “dormant” asset. At this point, expensive premium payments are being directed toward an investment that is likely under-performing. Freeing up cash creates more financial freedom and important new options for you and your family.

Tap into the financial power of an “Overlooked” asset.
Many people don’t think of their life insurance as an asset. Once they secure coverage they often pay the premiums and give little thought to the policy as an investment. It is simply regarded as an expense that must be kept up. But by the time you near retirement your policy may have become a solid asset with years of equity. Turn it into cash you can use today. We can help you unlock its potential.

Why Sell?

Like any personal property, your life insurance can be sold.

Each year hundreds of billions of dollars of face value of life insurance lapses by seniors over the age of 70 – mostly from a lack of knowledge that an unneeded or unaffordable policy may be sold.

There are numerous reasons to consider selling a life insurance policy:

  • The premiums are no longer affordable
  • There is a need for resources to pay for health expenses and long term care
  • The need to replace lost income in case of death of the insured no longer exists
  • The need for funds to pay estate taxes no longer applies
  • A term policy may be reaching the end of the coverage period
  • Funds are wanted to improve a retirement lifestyle

Do I Qualify?

In general, the following qualification criteria applies:

Age and health status of insured
Seniors who are age 70 years or older. Younger insureds may qualify, depending on certain medical conditions.

Type of insurance policy
Funds for Life can help you with every type of insurance policy, including term insurance. However the majority of policies sold in the secondary market for life insurance are universal life insurance policies.

The life insurance policy premiums
The amount of the premium payments to keep the policy in-force will also play a role on the offer amount.

Life insurance policy death benefit “face value”
Funds for Life can work with all face values. Have your policy details in reach when you call and we can get you started.

How Much Can I Get?

Selling your life insurance policy

When you sell your insurance policy, you receive a lump sum cash payment. That’s it.  No more premium payments.  The new owner pays all future premiums and receives the death benefit after the insured passes.

Every case is different. The amount you receive will depend on your policy value:

  • The death benefit (or face amount of your policy)
  • The annual premiums – the amount of premiums that will be paid per year
  • The number of years premiums will need to be paid
  • The rate of return required by the policy investor

The amount received from a policy is a mathematical determination that takes into account the impact these factors have on the value.

The amount received from selling a qualified policy will nearly always be greater than the cash surrender value from your insurance provider!