Life Settlement Broker
A life settlement broker is normally used in the sale of a life insurance policy by a senior citizen. This type of sale is a way for a senior, above the age of 65, to get a single lump sum cash payment amounting to something more than the surrender value of the policy. In the past, there were basically two options when a senior's life insurance policy was no longer needed. The insured could either allow the policy coverage to lapse or sell the policy back to the insurance company. According to the American Council of Life Insurers nearly 90% all universal life insurance policies have been allowed to lapse or been surrendered without many people even knowing they had the option of getting more than the surrender value. Enter the life settlement market. Seniors have a more attractive alternative to convert a current insurance policy to cash. Instead of turning in the policy to the insurance company in which the policy was originated for the surrender value, the insured works with a life settlement broker. The cash payment is called a settlement or more specifically a life settlement. The transaction involves a person transferring their rights as an insured to a settlement funder. Generally, the life settlement broker will be able to get the funder to pay substantially more than their insurance company would have paid had they simply turned it back in.
Quiet as its kept, an insurance policy is a salable financial instrument similar to a stock, bond, or mutual fund. There are five basic reasons a senior would consider selling their policy; 1) the person can no longer afford to pay the premiums, 2) the person needs cash and the money from the insurance policy is the last big asset that is available to them, 3) the person or loved one experiences a terminal and/or catastrophic illness, 4) the policy is no longer needed or wanted, or 5) there are changes in a person's financial situation. Using a life settlement broker can make the transaction move forward fairly quickly and easily. Most transactions are completed in less than 30 days. Although converting an insurance policy through a settlement will provide a windfall greater than the surrender value of the policy, be advised that it won't yield as much financial gain as the death benefit of the policy.
A typical client wants to convert the insurance they currently hold to another more beneficial financial use. In most, cases, it would be a senior who feels that they would have more peace of mind after making this conversion. The job of the life settlement broker is to facilitate the transaction. The broker acts on behalf of the client to secure the best funding offer for the policy. Applications are submitted to various institutions that offer cash surrender value for insurance policies. The offer commonly comes from a financial institution like a bank, insurance company, or mutual fund who will pay top dollar for these assets. Taking into account the insured's age, current state of health, the type of insurance policy it is, the financial strength rating of the policy issuing company, and the amount of insurance premiums that have to be paid; they will bid on how much they will pay to purchase the existing policy. The institution becomes the new owner of the policy. They pay all future premiums and collect the death benefit when the insured dies.
There are many different types of insurance policies that a life settlement broker deals with including; whole, universal, variable, term, joint survivorship, and group life. The main determinant of whether a specific policy is eligible for this process is set within the terms of the policy. The policy must be both convertible and assignable. The requirements for converting an insurance policy to cash through a life settlement broker include the following: 1) The insured must be age 65 or older, 2) The face value of the policy must be at least $250,000 (in most cases), 3) The policy must be out of the contestable period (which usually means its over 2 years old.) "And without controversy great is the mystery of godliness: God was manifest in the flesh, justified in the Spirit, seen of angels,preached unto the Gentiles, believed on in the world, received up into glory." (1 Timothy 3:16)
Life settlement payouts usually equal three to five times (and oftentimes much more than) the cash surrender value of the policy. An insurance company may allow a person to divide their policy into several parts. The policy owner would retain a portion of their policy, which will remain in effect, while selling other parts. The cash received after the sale has no restrictions as to its use. Depending on the current financial status or personal situation being experienced by the policy owner, the money may be needed to deal with medical expenses or long term health care. Some of the other popular uses of the money are donations to churches, charities, and gifts to family members. Some people use the money to fund other types of investments. Still others use the money to enhance the quality of their lives by paying off a home, investing in a business, or taking a world tour. The bottom line is that what a person chooses to do with the funds is up to them. Before a person decides to use a life settlement broker to convert their insurance policy, there are three things they should keep in mind. The person should make sure that the offer is in writing, be comfortable with the percentage of the broker's commission, and plan for any additional tax burden due to the size of the settlement.
Life Settlement ProviderSeniors can gain insight through a life settlement provider on alternatives to cashing out on a life insurance policy. People in need can easily find the assistance they need and the aid that is necessary for the accurate and successful transition from one form of financial savings to another. Life can be uncertain at times and the one aspect that should be counted on is the confidence that money matters can be taken care of without the risk of substantial loss, "for I am with thee, saith the LORD, to deliver thee" (Jeremiah 1:19). Experts are available to assist in potentially confusing and important matters related to finances.
Many companies can be found which specialize in the area of life settlement provider. Everyone will at some point in life, require the funding necessary for retirement or perhaps for full time care in a nursing home or assisted living center. Most companies are run by experts who are not only well educated but posses the skills and qualifications needed to assist people in any way possible. The elderly should not have to worry about financing for the care that might become a part of everyday life. People who have learned from experience what types of plans work best for specific types of people are the ideal ones to assist those who are in search of a life settlement provider. Whatever a person needs they should be able to obtain in a relatively easy manner. Those who are familiar with the Internet can find a lot of information on the different plans that are available as well as lists of providers who are available to assist in any way.
Everyone should be able to live life to the fullest and a senior citizen is no exception. In fact, those who are well seasoned in years deserve to have the peace of mind that can come with the knowledge of substantial and sufficient funding for either themselves their spouses, or funds left to family. A life settlement provider generally helps explain alternatives to cashing in on a life insurance policy. For a long time the only options available to people who no longer require or desire a life insurance plan was to wait for the policy to expire or else cancel the plan and in the process lose a lot of money. A life settlement can be gained to replace an unnecessary insurance plan while simultaneously gaining money versus losing. A provider can ensure that the transfer from one policy to another will take place as smoothly as possible.
There are a few qualifications that must be met before a person is eligible to receive a new policy. A life settlement provider should be able to clearly explain each qualification to those interested and do what they can in order for a person to receive the proper information that will help to put them on the right track. One of the main qualifications is that a senior must be at east sixty-five years of age. Anyone who is younger need not apply due to the fact that they will most likely be turned down. Another necessity is that a person must have a good idea about whether or not the policy will be needed for at least two years. This ensures that the policy will have enough time to be enacted as two years is the amount of time that that is required for a plan to be functional.
Many seniors can seek assistance from a life settlement provider which is essentially a person or group that purchases an insurance policy and becomes the new legal owner. After the transaction the new owner takes on all subsequent responsibilities and payments. The process can be confusing which is why several companies and organizations have been established in order to assist with the procedure. Most companies specialize in the ability to turn insurance policies into money that can be used for whatever means a person desires. Normally, the sale of a plan would lead to less money gained, however a settlement ensures that can in many cases exceed the amount of value on most other policies. Seniors who are the best candidates to consider the process are those who have entertained the thought of letting an insurance plan expire and those who are perhaps tired of paying on expensive premiums. The elderly should not have to spend large amounts of money on premiums just to keep a policy in place.
A company that serves as a life settlement provider should be committed to providing the best services possible to those in need. There are rules and laws in place that are intended to help ensure ethical and honest procedures and the assurances that companies will adhere to strict standards and a high level of professionalism. Citizens who choose to work with a provider can expect to receive several benefits. One of the main benefits to be expected is a smooth and seamless transition as well as attention to detail. Companies are usually made up of a team of professionals who make a point to scrutinize all paperwork and the details that are involved with each and every request and procedure. When a company is committed to excellence, nothing short of the best in service should be expected by those who request aid and assistance.
Due to the fact that there is many a life settlement provider to choose from, potential clients should be certain to check up on the credibility and reputation of a business. Before the choice has been made to go with any one company, a senior should look into various providers in order to make sure that they receive a plan that works the best for them and their individual needs. Simple research should be sufficient in order to ascertain whether or not a provider is legitimate and committed to treating clients as human beings.