Turning Death Benefits into Living Benefits
Consider a Life Insurance Settlement

It is estimated 89.5 percent of universal life policies do not result in death claims.

Life settlements typically cater to people over 65 years old and is the sale of an unneeded or unwanted life insurance policy, for a cash payment greater than the policy's surrendered value, but less than the policy's death benefit.

For a convertible term life policy, it provides immediate cash and liquidity that would otherwise only be available to the beneficiary after the insured's death.

Once sold, the third party becomes the new owner of the policy, continues to pay the premiums, and as the new beneficiary, eventually receives the face amount of the policy as a death benefit.

Here's an example:

A 79-year-old man owned a $650,000 universal life policy with a cash surrender value of $49,867. He sold the policy for $229,808.

Why sell a life insurance policy?

Make it become a real current liquid asset to be used in your lifetime. A life settlement is appropriate if the policy holder is considering letting a policy they no longer need, lapse, as they have outlived the beneficiary, or the premium has become a financial burden.

Other reasons are the children are grown and well on their way, and no longer dependent on the insured. Also, a policy is no longer needed for estate planning purposes; proceeds could also be used for long term health care, retirement investments, gifts to children or charitable gifts.

The average purchase price the owner receives in a life settlement is about four times the cash surrender value, depending on the age and health of the insured. Term policies that can be converted to universal life are also good candidates for life settlements.

For more information contact Ron Rasmussen at 760-788-0671 or e-mail RAZ2005@msn.com.