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Life Settlements Can Be A Smart Move For Many Reasons

August 15th | No Comments | Posted in Articles, Life insurance

Life settlements refer to sales of life insurance policies when they are not wanted. Often, it is the elderly that make use of this kind of transaction. It is usually done when the policy can be sold to an investor for more than the cash value that the insurance company would offer.

There are a variety of reasons why a person might take advantage of this. In some cases, the policy is no longer needed. In other cases, the state of the person’s health has declined so that the policy is worth more as a life settlement than if it were surrendered. In other cases, the policy might not be performing well or the person may not be able to pay for it any longer.

Cash that is received from a life settlement is usually more than the surrender value but less than would be paid out upon death. The life settlement company will take over responsibility for premium payments and will be the beneficiary upon the person’s death.

Often times, a life settlement is chosen because the cash is necessary now for some reason. It may also be considered when needs change due to death or divorce. If the original beneficiary upon death was a spouse, for example, who is now dead or has been divorced, cash today might be preferable.

Life settlement brokers are usually responsible for negotiating the contract and receive a fee from buyers. Several considerations will affect how much the policy owner is offered for their life insurance. Because of this, it is smart to talk over your options with more than a single life settlement company so that you can be sure of getting the best offer.

Life settlements are a great alternative for many people to get the cash out of an insurance policy they no longer want. Compare this to other possibilities such as borrowing against the policy. Also, bear in mind that the proceeds may be subject to taxation. It is a good idea to consult with a tax advisor or lawyer before making a final decision.

Learn more about life settlements. Stop by Kelly Ramirez’s site where you can find out all about what a life settlement broker can do for you.

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