Direct buyers for your life insurance policy have transformed the life settlement industry. Until 2016, selling a life insurance policy required a life settlement broker. Brokers often charged up to 30% of the sales proceeds, and in some cases, as much as 40-50%. They were responsible for finding a buyer and were expected to secure the best offer for policyholders. However, this involvement did not always mean getting the highest possible value.
Working without a broker might seem daunting. However, understanding a broker’s role clarifies what obligations they have. Brokers prepare life insurance policies for sale but charging hefty commissions can impact the final proceeds policyholders receive. Many policyholders would benefit more by dealing directly with buyers.
There are specific requirements to sell a life insurance policy for cash. Essential documents include all medical records, pertinent illustrations, and verification of coverage from the life insurance carrier. These documents are necessary for obtaining a third-party independent life expectancy report. Life expectancy reports examine factors such as health, family history, and age to estimate the policyholder’s longevity.
A life expectancy is typically given in months. For instance, if the report states a 120-month life expectancy, it indicates that the policyholder is expected to live for about ten years. In-force illustrations from the life insurance company predict the premium costs over this period to keep the policy active until it matures.
Selling a life insurance policy transfers the premium payment responsibility to the buyer. This is reassuring if premiums become expensive or if there are no immediate health concerns. Buyers evaluate policies similarly, so understanding this process is beneficial for potential sellers.
Qualifying to sell a life insurance policy depends on various factors, including age and health condition. Both healthy older adults and younger individuals with terminal illnesses can sell their policies. For example, a 40-year-old with a short life expectancy might see 50-80% of the policy’s face value due to lower premiums and shorter payout periods.
Conversely, a healthy 75-year-old might still find hidden value in their policy, even with an expectation to live another decade. The key is understanding how to maximize the offer and finding direct buyers willing to purchase policyholder insurance directly.
The market adjusted in 2016 to support direct selling platforms, bypassing brokers. These platforms allow consumers to present their policies to direct buyers without broker fees. Obtaining direct bids maximizes the policy’s value. Platforms also manage necessary documentation, securing medical records through HIPAA-compliant methods and presenting information to buyers seamlessly.
When sellers use these direct platforms, they do not bear the cost of acquiring medical records or life expectancy reports. The buyers consider these costs part of their business operations. This ensures sellers benefit from a streamlined, cost-effective process.
Understanding your policy’s value can often be determined in a quick 5-10 minute call. If the documents and records are in order, a precise valuation of the life insurance policy in the secondary market can be provided. It is crucial not to lapse or cancel a policy without exploring its hidden value through direct buyer platforms.
Thousands have benefited from evaluating their policy’s worth, facilitating sales to direct buyers. Direct buyer engagement usually nets higher proceeds compared to broker-involved sales because of the absence of commissions. Multiple bids ensure competitive offers, maximizing the policy’s sales value.
For individuals actively selling their life insurance policy, evaluating direct bids can yield better prices. A brief call can determine qualification, and once authorized, valuation and offers can proceed without additional effort from the seller. There are no obligations or fees at any step in determining the policy’s suitability for sale.
With no risks and potential high returns, exploring the option to sell directly is a prudent step. If considering canceling or surrendering your policy, exploring direct sc™sing or surrendering your policy, exploring direct selling options ensures informed decision-making. We understand the importance of these choices and offer a seamless pathway for those ready to explore direct buyer markets. By providing pertinent information and necessary support, we help policyholders navigate the sale of their life insurance confidently and efficiently.
