In The Know – How to Profit from the Sale of Your Unwanted Life Insurance Policy
WHAT IS A LIFE INSURANCE SETTLEMENT?
Watch David’s fun and informative video to learn more.
Each client’s experience varies, and there is no guarantee that a life settlement will generate an offer greater than the current cash surrender value. In such cases, the client can always surrender their policy to the carrier if the coverage is no longer needed. This material is intended for informational purposes only and should not be construed as legal or tax advice or investment recommendations. Consult a qualified attorney, tax advisor, investment professional or insurance agent about the issues discussed herein. In a life settlement agreement, the current life insurance policy owner transfers the ownership and beneficiary designations to a third party, who receives the death proceeds at the passing of the insured. As a result, this buyer has a financial interest in the seller’s death. A policy owner should consider the continued need for coverage, and, if the policy owner plans to replace the existing policy with another policy, the policy owner should consider the availability, adequacy and cost of comparable coverage. Policy owners considering the need for cash should consider other less costly alternatives. When an individual decides to sell their policy, he or she must provide complete access to his or her medical history, and other personal information, that may affect his or her life expectancy. This information is requested during the initial application for a life settlement. After the completion of the sale, there may be an ongoing obligation to disclose similar and additional information at a later date. Individuals should discuss the taxation of the proceeds received with their tax advisor. ValMark Securities supervises all life settlements like a security transaction. A life settlement may affect the insured’s ability to obtain insurance in the future and the seller’s eligibility for certain public assistance programs, such as Medicaid, and there may be tax consequences. ValMark and its registered representatives act as brokers on the transaction and may receive a fee from the purchaser. A life settlement transaction may require an extended period of time to complete. Due to complexity of the transaction, fees and costs incurred with the life settlement transaction may be substantially higher than other securities. Once the policy is transferred, the policy owner has no control over subsequent transfers. If you are an investor or a buyer of a life insurance policy then you should be aware that: Investment in a life settlement is highly speculative. Although a substantial profit may be realized, a substantial loss is also possible. The death benefit may never be paid. Additional funds may need to be invested to pay premiums if the insured lives substantially longer than expected.
Securities offered through ValMark Securities, Inc.
Member FINRA, SIPC.130 Springside Drive, Suite 300, Akron, OH 44333
800.765.5201 Investment Advisory Services offered through ValMark Advisers,
Inc., a SEC-registered investment advisor. Rosell Wealth Management is a
separate entity from ValMark Securities, Inc. and ValMark Advisers, Inc.