Am I Eligible for a Life or Viatical Settlement? - MRE Finance

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Am I Eligible for a Life or Viatical Settlement?

A life settlement is a single transaction, therefore, certain criteria must be met in order to be eligible for a life settlement or viatical settlement.

When you sell your life insurance policy, you will receive a one-time cash payment and you no longer pay the premiums.

The following factors determine the potential value for a life settlement.

your age
gender
state you live in
health condition
type of insurance policy (Universal, Whole, Convertible term, Variable etc.)
the policy pay out amount (death benefit)
how much are the premiums
your contact information

The Age of the Policyholder

Typically, those who are 70 years of age and older have a higher chance of finding a buyer willing to make an offer to purchase the life insurance policy for a life settlement.

Health Status and Life Expectancy

Your personal health status has an impact on life expectancy which affects the value of the life insurance policy. The longer the expected life span, the lower the policy’s value as the buyer continues to pay the premiums until they collect the death benefit.

The following 4 health categories are those to choose from that best describe your health.

Healthy: Active and exercise regularly
Minor Conditions: Medical conditions that require management such as diabetes or high blood pressure
Serious Conditions: Serious medical conditions such as cancer, Alzheimer’s, heart disease, stroke
Terminal Conditions: End-stage of life conditions such as late-stage cancer, congestive heart failure, liver, pulmonary disease

By N. Rouse|2022-12-19T16:42:40-05:00December 3, 2022|General|Comments Off

About the Author: N. Rouse

Life Settlement QUESTIONS

Why Selling a Life Insurance Policy is a Good Idea?

Selling a life insurance policy may be a good option for seniors 70 years or older or for individuals who are chronically or terminally ill. It may also be an option if your life circumstances have changed, your premiums are no longer affordable or you no longer have dependents who will need financial support after your passing. With increased uncertainty about the economy, many seniors are looking into how to sell their life insurance policies. Selling your policy for a lump sum cash payment can help you pay for medical bills, vacations, paying off a mortgage, or supplementing retirement while providing you greater financial security and peace of mind.

How Does Selling a Life Insurance Policy Work?

The policy owner transfers ownership of the policy to a licensed buyer known as a Settlement Provider in return for a cash payment greater than the surrender value but less than the total death benefit. The process is easy. You’ll submit an application with basic information about the policy and the insured person to be evaluated by the Provider.

Information you will need to provide is:

Your age
Health status
State you live in
Type of life insurance policy you have (whole life, convertible term, or universal life)
The cash surrender value (accumulated cash value) of the policy
Amount of premium you pay per year

Once qualified, the Provider will request additional information such as the life insurance policy documents and the medical records of the insured. The private information you provide is needed for the Provider to make a decision to purchase the policy.

MRE Finance respects your privacy and only works with licensed and reputable Providers. Selling your policy typically allows you to receive more money than if you surrender or terminate the policy with the insurance company for the cash value. If you stop paying the premiums and lapse the policy you typically will receive nothing. People often pursue a life settlement because they no longer need or can afford their life insurance policy and would rather have cash in their pocket. You can use the money received from a life settlement transaction however you’d like, including paying for long-term care needs, medical bills, or funding your retirement

What Are the Steps to Sell a Life Insurance Policy?

The buyer/provider will walk you through the process and with the information you provide they are able to determine if you qualify and then make an offer to purchase your life insurance policy

Health questionnaire. You’ll need to complete a health questionnaire.
Authorization. The insured and the policy owner (if different from the insured) will need to provide authorization for the life settlement Provider to contact the insurance company on your behalf and access medical records.
Insurance Policy Documents. You will need to provide a copy of the life insurance policy. If you don’t have copies available, the life settlement Provider can request these documents from the insurance company with your authorization.
Evaluation. The life settlement Provider will evaluate all the details of the policy and medical records to help determine value.
Offer. With all the necessary information, the life settlement provider may proceed with making you a cash offer for the policy.
Closing. The closing process is the actual transfer of ownership of the policy to the Provider with all the accompanying documentation. During closing, your settlement payment will be placed in escrow until your insurance company has verified the change of ownership. Once verified, the escrow agent releases the funds and you receive your cash payout.

How Long Does It Take To Sell Your Policy?

Overall the process takes approximately 6-8 weeks for settlement to be finalized with an experienced Provider, but timelines can vary based on who your insurance company is and the Provider receiving the needed documents.

What is a Viatical Settlement?

A viatical settlement is a life settlement for those with a terminal or chronic disease. These typically are the highest valued policies – often 2 to 3 times more than a life settlement as the policyholder has a limited life expectancy. Viatical settlements are typically used by individuals who need to pay for medical expenses now, so they choose to forgo the full value of the benefit in the event of their passing and receive a payment now.

What is a Life Settlement?

A Life settlement refers to the legal transaction between the life insurance policyholder and a third-party buyer known as a Settlement Provider for an upfront payment. Life settlement cash payouts are typically higher than your policy’s cash surrender value but less than the total death benefit of the policy. Some of the reasons why people choose a life settlement include; unaffordable premiums, medical bills, supplementing retirement, emergencies, or if they no longer need the policy for their dependents or other personal reasons. A life settlement is usually a better alternative to lapsing or the surrender of a life insurance policy.

MRE Finance

Address: 1719 Route 10, Suite 233,
Parsippany, NJ 07054

Phone: +1-800-521-0770

Email: [email protected]

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MRE Finance is a marketing company and will refer qualified policies to licensed life settlement brokers or providers and does not represent the policyholder. *Any estimate using the life settlement calculator provided is intended to be used as an evaluation and qualification of life insurance policies and does not guarantee the price of what a policy can be sold for, nor that a life settlement provider will make an offer to purchase a policy. © 2023 MRE Finance LLC. All Rights Reserved. Privacy Policy | Terms and Conditions.