Frequently
Asked Questions for the Senior Citizen
What is a life settlement?
Why do senior citizens sell their
life insurance policies?
Is it legal to sell your
life insurance policies?
How much money will I get
for my policy?
After I sell the policy,
are there restrictions on what I do with the money?
I trust my current financial
advisor and do not want to bypass him/her, can we all work
together on this transaction?
Are the proceeds from a
life settlement taxable?
What types of life insurance
policies can be sold?
How do I know if my policy
qualifies?
Are there any application
costs or medical exams?
Is the process confidential?
How long does it take
to sell an insurance policy?
What happens to the
policy after I sell it?
What if I'm not old
enough to qualify for a life settlement, but have a shortened
life expectancy due to illness?
May I donate all or part
of my policy?
What is a life settlement?
A life settlement is the sale of a life insurance policy insuring
the life of a senior citizen in return for a lump sum of cash.
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Why
do senior citizens sell their life insurance policies?
The reasons are many:
• The policy is no longer needed or wanted
• To pay for the rising cost of long-term healthcare
• The premiums become unaffordable
• There is a change of beneficiary due to death or divorce
• To receive more money than the cash surrender value
• There is a forced liquidation due to financial hardship or bankruptcy
• There is a change in estate planning needs
The desire to live your later years more comfortably is one of the
many good reasons to consider a life settlement.
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Is it legal to sell your life insurance
policies?
Yes. The sale of a life insurance policy is regulated by most states
and requires the involvement of a licensed broker. A broker is legally
obligated to find the highest possible selling price for the policy owner,
similar to a real estate agent selling a home.
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How much money will I get for my
policy?
It depends on a number of factors such as:
• Your estimated life expectancy
• Your age
• Your medical condition
• Type of insurance policy
• Insurance company rating
• Annual premium payments
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After I sell my policy, are there restrictions
on what I do with the money?
No. Regardless of why you decide to sell, the money is yours to spend,
as you like.
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I trust my current financial
advisor and do not want to bypass him/her, can we all work
together on this transaction?
Yes, First Secured Life will work with your financial advisor, attorney,
or other professional to ensure you are completely comfortable throughout
the transaction.
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Are the proceeds from a life settlement
taxable?
The proceeds are generally tax-free up to the amount of premiums paid.
We recommend that you consult your tax advisor.
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What types of life insurance
policies can be sold?
The most common types of life insurance policies include but are not
limited to:
• Universal Life
• Whole Life
• Term Life
• Variable Life
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How do I know if my policy qualifies?
Most types of policies qualify if:
• You are 65 years of age or older*
• Your life insurance policy is $100,000 or more in face value
• You have had the policy for at least two years
* A terminally or chronically ill person may qualify regardless
of age.
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Are there any application
costs or medical exams?
No. There are no application costs or medical exams required.
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Is the process confidential?
Yes. All medical, financial and other personal information obtained during
the course of the transaction is treated with the utmost confidentiality
and will not be disclosed to any unauthorized party.
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How long does it take
to sell an insurance policy?
The transaction generally takes approximately
30 - 45 days after receiving your completed application.
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What happens to the
policy after I sell it?
All rights and obligations of the policy
are transferred to the new owner. You will no longer be
responsible for paying the policy's premiums.
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What if I'm not old
enough to qualify for a life settlement, but have a shortened
life expectancy due to illness?
Due to your medical condition, you may qualify
for a life settlement. A life settlement is a cash payment
from the face value of a life insurance policy payable
to an individual living with a terminal, or life-shortening
illness of any age. If you think you might qualify for
a life settlement, please complete the pre-qualification
form for a free
appraisal or you may call us
at 1-877-968-7785.
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May I donate all or
part of my policy?
Yes. Life Settlements offer you the option
of donating all or part of your life insurance policy
to a charity or religious organization of your choice.
Favorable tax implications may apply.
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