Life Settlement Policy FAQ’s

Text Size

Life Settlement Policy

Why Would Someone Sell Their Life Insurance Policy?

There are many reasons someone would sell a life insurance policy, such as:

Premiums have become unaffordable
Term period or conversion privilege expiring
Financial hardships are present
Your business is sold or you retire and corporate coverage is no longer needed
Change in estate value
Long-term care is required
Death of a spouse or divorce
Policy has underperfomed
Any change in the original need for coverage

Which situations are helped most by a life settlement?

If… a)you are 76 years or older; b)you are an adult child of parents age 76 or older; c)you are any age and have a chronic or terminal illness, or d)you are considering applying for admission into a continuing care retirement community. Click here to find out more about who benefits from a life settlement.

What Types Of Life Insurance Policies Can Be Sold?

Generally, all types of life insurance policies can be sold including specific types of term, which may come as a surprise to consumers. Although term policies do not have cash value, they often have significant value as a life settlement.

How Much Money Will Sellers Get From A Policy With A Life Settlement?

Typically, a policy owner can expect to receive between 10% – 60%** of their policy’s death benefit. Please note that funders will typically pay an average of up to 8 times*** more than the existing cash surrender value.

What Happens To My Policy After A Life Settlement?

After a policy is sold, all rights and obligations of the life insurance policy are transferred to the new owner. Sellers are no longer responsible for paying premiums and are free to use the proceeds however they wish.

Are There Any Application Costs Or Medical Exams?

There are no application costs or medical exams required.

What Factors Go Into The Offer That I Will Receive?

The gross offer for your policy is based upon your age, your life expectancy, your premium costs, your insurance company’s rating and other policy details. While you will never pay out-of-pocket for any services, the net offer will reflect the fee earned by your life settlement broker.

What If I Change My Mind?

If you change your mind about selling your policy, you can cancel the life settlement contract at any time up to the end of the rescission period. Some states have a rescission period of three days, while others have a 15 to 30 day rescission period, and unregulated states do not have a rescission period.

Are The Life Settlement Proceeds From Selling My Policy Taxable?

On May 1, 2009, the IRS issued two revenue rulings to clarify the income tax treatment to the surrender, sale and purchase of life insurance policies. Quantum Life Settlements strongly recommends consulting your tax advisor for more information. Click here for more life settlements tax information.

Disclaimer: Quantum is not a tax advisor and does not offer or issue tax advice. It encourages all policy owners to consult their own independent tax attorneys, advisors and/or CPAs.

Have Other Life Settlement Questions?

Call 1-888-446-2885 for a FREE Consultation

The entire appraisal process is free and there is no obligation to sell your policy once you've received an offer.

*,**results will vary based on a number of factors including without limitation, policy type, size and cash value, health of the insured and premiums.
***GAO - Report to the Special Committee on Aging, U.S. Senate July 2010.

Disclaimer: Quantum services are not available in all states.

CALL 1.888.446.2885