Thursday, November 5, 2015

A Life Settlement is a cash payment to the owner of a life insurance policy in exchange for the assignment of the ownership of the policy. With a Life insurance Settlement you turn an otherwise untouchable asset into something liquid, something immediately useful.

By liquidating a policy for amounts higher than the cash surrender value, policy owners can initiate important financial opportunities with a cash infusion from the proceeds of an unwanted, unaffordable or unnecessary life insurance policy. Changes in your lives and circumstances can reduce or eliminate the need for an existing life policy! What was once a sound and essential asset can often evolve into an unneeded expense---even a burdensome liability.

With current economic conditions created by stock market declaims, combined with poor retirement fund performances, this option offering amounts greater than current cash surrender value for policies no longer relevant to someone’s current needs has strong appeal.

With your new found cash, you can invest in annuities, enhance your estate planning, provide for long term care needs or use the money to better enjoy and live the life you've earned.

Why choose a Life Settlement?
A life insurance policy is the property of the owner. A policy may be sold when the owner has determined that he or she no longer needs the policy. This may arise in circumstances such as business owned policies where the insured is no longer connected to the business, or where the insurance proceeds are no longer needed to pay estate taxes or final expenses. The contract may be sold for any reason that the owner may desire

Examples of policies that are not needed any more are:
1. Policy bought years before to fund a child's education in the event of the policyholders premature death. Now the children are grown and out of college, and the need for the policy is no longer needed.

2. Policy listed the spouse as the beneficiary. The spouse has predeceased the policyholder, and the policyholder would rather have the money now than leave the death benefit to another beneficiary.

3. The premium payments have become too expensive to keep up.

4. Circumstances have changed so that the policyholder's need or desire for the funds now outweighs the original purpose for the policy

There are no medical examinations required, there is no cost to find out what a policy is worth, and we will purchase most any kind of life insurance policy (whole life, term, universal, group policies, and split dollar policies) issued by most any life insurance company.
Consider the following scenarios:
The husband holds a policy with his wife as beneficiary. His wife predeceases him and he has no children. He would rather sell the policy and use the funds now than leave the policies death benefit to someone else.

Retiree is offered his employer's key person policy upon retirement. Retiree doesn't need the policy, but recognizes that he can accept the policy and then immediately sell it for cash, perhaps before he's even made the first premium payment!

Senior citizen's policy has a policy on which the premiums have simply gotten too expensive. Before, the choice was to let a term policy lapse, or cash in a permanent policy. But now, the policy can be sold, realizing more value for the policyholder.

These are just a few of the examples of how the sale of an unneeded life insurance policy can fit into a senior citizen's financial planning. Many senior citizens will be pleasantly relieved to know that they can now receive the money while still alive, possibly tax free, and that they will not have to make any more policy premium payments.

Whether you qualify for a senior settlement or not depends on the type of life insurance, the age and health of the insured and the amount of premiums needed every year.

The most significant aspects, which determine the settlement amount are the combined effect of the health and age of the insured. If the life insurance is a survivorship policy, the age and health of both insured individuals is will be considered. Healthy seniors in their seventies would qualify and seniors as young as 65 may qualify if other health circumstances provide for a limited life expectancy.

The amount of life insurance premiums plays a major role in determining the offer in a senior settlement. The lower the annual premium amount, the higher the settlement offer. Most life insurance policies can be sold, including:
Term life insurance
Whole life insurance
Universal life insurance
Individual policies insurance
Group policies insurance
Corporate policies insurance
Retiring executives may find excess life insurance coverage in their "key man" policies and "buy & sell" agreements. These policies may have outlasted their purpose and would have significant life insurance coverage that requires a heavy premium commitment. Through a senior settlement, the retired executive can transform an otherwise disappearing asset into immediate cash.

Print out an application packet, containing an application, as well as authorizations to gather the necessary information to get you an offer for your policy. There are two different applications available, one for policies with a face value under $250,000, and one for policies with a face value over $250,000. Upon receipt of your completed application, we'll obtain your medical records and additional pertinent information from your physician(s). We'll also review and verify your insurance information with your insurance company. Once all information has been gathered, we will find the highest dollar amount offer possible for your policy. We will keep you informed of the progress of your application and will be available at any time to answer all questions that you may have during this process. There is never any obligation on your part during the application process. You may cancel at any time without penalty.

The Settlement Process.
As offers are collected for your policy, your counselor will negotiate on your behalf to ensure that you will make an informed decision. We will advise you of each and every offer we receive on your policy as well as counsel you on your possible options and answer all your questions. Once you've decided to accept an offer, we will facilitate the closing process and keep you updated until you have received your funds. We promise to work on your behalf until the transaction has been closed to your satisfaction. If you are not satisfied, please remember that you are never under any obligation to accept any offer and the entire process is always at no cost to you. You have the right to change your mind for 15 days for absolutely any reason. In order to rescind, the viator must return the entire purchase amount plus any premiums paid to the purchaser.

 Defining the Terms
   A life settlement is the sale of a life insurance policy to another person or company in return for a cash payment of less than the full amount of the death benefit.
    A life settlement provider is the person or company that becomes the new policy owner in return for a payment made to the seller. The life settlement provider becomes the policy owner, must pay any premiums that are due, and eventually collects the full amount of the death benefit from the insurance company.
    The life settlement broker is the person or company who represents the seller of the policy and can comparison shop for life settlement offers. The buyer pays the broker a commission if the sale is completed.
Questions to Consider
Do I still need life insurance protection?
Will I Qualify for a new life insurance policy in the future?
If I sell my policy, how will they decide how much cash cash I get?
If I sell my policy, will there be any costs I have to pay?
If I sell my ploicy, will the money be put into an esrow account? If so, who will the escrow ageny be? Does state law require the agent to be licensed?
Is my policy an employer or other group policy? If so, do I need their permission to sell it?
If I sell my policy, who will be the legal owner?

Is the viatical settlement provider I plan to sell to allowed to do business in my state?
After I sell my policy, can the buyer resell it?
Understanding Life Settlements
   A life settlement is the sale of a life insurance policy to a third party. The owner of a life insurance policy sells it for a cash payment that is less than the full amount of the death benefit. the buyer becomes the new owner and/or beneficiary of the life insurance policy, pays for all premiums and collects the full amount of the death benefit when the insured dies.
    People decide to sell their life insurance policies for many reasons. When an individual with a terminal or chronic illness sells his or her life insurance policy, that is known as a viaticle settlement. When an individual who does not have a terminal or chronic ilness sells a policyfor other resons, including changed needs of dependants, wanting to reduce premiums, and cash for meeting expenses, that is known as a life settlement.    

    Contact a professional tax advisor. Find out the tax implications. Proceeds are only tax-free under certain circumstances.
    Know that your creditors could claim the proceeds.
    Find out if you'll lose any public assistance benefits such as food stamps or Medicaid if you get a cash settlement.
    Know that you must provide certain medical and personal information to third parties who will be paid the proceeds from your policy upon your death.

Denver Life Insurance from Philly:

Life insurance is the agreement between the life insurance company and you where you agree to give certain pre-payments to it and the company agrees to give a lump of money to somebody who you choose if you pass away.

How life insurance works

In life insurance, four roles exist: the life insurance company, the insured individual, the policy owner and the beneficiary. Technically, the last 3 roles could all be the same individual. Also, one policy might cover more than 1 insured and might have more than 1 beneficiary.

The insurance company vows to give a death benefit to the policy beneficiary upon the insured’s death, as long as this policy is still valid at that time. The policy owner takes responsibility for paying his premiums to maintain his poilcy.

The purposes of life insurance

The commonest purpose of a life insurance is protecting the finances of a person’s family and friends if a wage-earner should die, but that is not its only application but life insurance in Denver could be used:

    To get childcare and cover a home-maker's tasks
    To get estate protection
    To cover the mortgage
    To retire financially stabld
    To safeguard a business against losing a key worker
    To have as an employment plus

Types of life insurance

Life insurance is perceived best by dividing the types of life insurance in three categories: whole life insurance, universal life insurance and term life insurance,.

Whole life insurance demands fixed payments on a predetermined schedule. These policies have a coverage to a certain time (normally 100 years). These policies offer a death benefit, and even if the individual insured outlives this policy, his death benefit still gets paid. These policies have a cash value, meaning that they could be easily liquidated.

Universal life insurance permits payments of different amounts at any time (following the certain governmental stipulated maximums). Coverage by these policies may be continued indefinitely. Those policies have cash value, meaning that they could be easily liquidated.

Term life insurance deems fixed payments on a predetermined schedule and has coverage for a short duration (for example 10 years). This policy pays the death benefit only if the insured person dies before his policy expires.