Curious About Life Insurance Settlements? Look at These Case Studies

Some of the best-insured people still struggle with footing bills and managing expenses, especially retirement expenses. Life insurance settlements are a logical option for these people and also those that cannot afford to continue paying their premiums. Instead of surrendering your policy and getting little to no cash, you reach out to a life settlement investor.

Life insurance settlements allow you to transfer your life insurance policy to the investor and receive the agreed amount of cash in exchange instead of having to surrender the value. The new owner becomes responsible and inherits everything from the policy. They pay the premiums and will also get the death benefits. Life settlements are straightforward procedures with a good investor company, and many successful settlement cases exist.

If you’ve been considering a life settlement, read case studies to give you insight into what to expect.

78-yr-old Brenda With A Universal Life Policy

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Source: freepik.com

Brenda had initially taken her policy as a cushion to financially protect her children if the worst were to happen. Fortunately, her children grew to be self-sufficient adults who no longer need her financial support. Her situation is common in many case studies where a policy feels like dead weight, and the expensive premiums are taking away from the ability to contribute to your retirement fund.

At her age, Brenda qualifies to get a traditional life settlement where she can easily trade her universal life policy for an immediate lump sum of cash or continuous income throughout her life.

34-year-old Jeniffer With A $250,000 Universal Life Policy

After being diagnosed with cancer, and like how most life settlement cases begin, Jenniffer was faced with difficult financial decisions. She had a life insurance policy that she knew would help her loved ones if the worst came to the worst. However, her medical condition is financially demanding due to the constant medical costs.

Jennifer’s health condition qualifies her for multiple settlement options. However, looking at case studies similar to her situation, the best option would be a hybrid life settlement. It will allow her to trade her policy for a package that includes receiving a predetermined cash amount and a retained benefit. That way, she can foot her medical bills with the comfort of knowing her family is still taken care of.

67-year-old Steven With A $1,000,000 Term Policy

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Source: freepik.com

After an ALS diagnosis, Steven immediately knew that he could not afford to continue paying his premiums. His primary concern after the realization was the need to ensure his wife still had money during her retirement in case of anything.

Stephen’s case qualifies for a retained death benefit settlement. The settlement allows him to retain a substantial amount from his death benefit and not need to continue paying premiums.

The insured 75-year-old man had a $300,000 term policy, was in stand health, and was at the end of the level premium paying period. The man felt that he did not need the coverage anymore and, being in the conversion period, wanted to drop the policy. He went for a life settlement on learning of the possibility of a higher value in the secondary market. After underwriting, his life expectancy report showed 180 months, and he managed to make $5,000.

75-year-old Pete With a $250,000 Universal Life Policy

A couple, Pete and Jeannine, reviewed their financial health many years after retirement. They noticed that their rate of expenditure was worrying; they had lost track of their budget and were worried about their ability to maintain their lifestyle in years to come. Fortunately, Peter learned he was a suitable candidate for an income-for-life insurance settlement.

Pete can trade the expense of his costly insurance premium for a permanent source of income for the rest of his life. The life insurance settlement allows them to enjoy their golden years without stressing over the retirement fund.

59-year-old woman with $2,000,000 Convertible Term Policy

The 59-year-old woman was battling lung cancer and had a $2,000,000 convertible term policy. The lady needed funds to afford quality healthcare and allow her an opportunity to enjoy her retirement years. Given her circumstance, paying her expensive premiums at the time ceased to become a priority. After choosing to get a life settlement, she managed to get $1,390,000 in settlement.

72-year-old Male With A $ 896,450 Life Policy

The 72-year-old man had carotid artery disease and hypertensive heart disease. He had a $896 450 life policy but did not manage to pay the premiums for a while. Frustrated by watching his surrender value lowering every month, he considered cashing his policy and getting $94,647. However, he learned of the alternative, the life insurance settlement option. His life expectancy report was 99 months, and he was able to get $200,000, which is over twice the surrender value he considered.

71-year-old Man With $525,000 Universal Life Insurance

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Source: freepik.com

The 71-year-old man with a $525,000 universal life insurance policy was in relatively good health. He could not afford the policy and was waiting for it to lapse and had given in to the reality of not getting anything out of it. After learning about life insurance settlement, he was able to get $45,000.

87 And 88-year-old Couple With A $2,000,000 Survivorship Policy

An 87-year-old female was ready to surrender her coverage for a small cash settlement. She and her husband had taken a $2,000,000 survivorship policy with her 88-year-old husband, but they could no longer afford the premium. They were able to get a life settlement of $240,0000

Life Insurance Settlement

Had all these policy owners been unaware of life settlements, they would have lost significant value in the policy.  Life insurance settlements are an excellent avenue for liquidity and have saved policyholders significant amounts of money they would have otherwise lost. If you are thinking of surrendering your life insurance policy, consider getting a life insurance settlement and get more value from your policy.