Insured Life Settlement Essay

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A life settlement, also known as a senior settlement, is a valuable financial transaction that allows you to convert your life insurance policy into a cash valued asset. Your life insurance policy can now be used and sold just like any other asset such as real estate or stocks and bonds. This process works by the backing of major financial institutions that buy individual policies and combine them to create a low-risk, high-yield investment platform that allows you to turn a life insurance policy into an asset.

In order to determine if you are eligible, and if the transaction makes good financial sense for you and your family, you must own the life insurance policy and you should be able meet a few criteria. A certified life settlement broker can help you make this important …show more content…

Your current age and your life insurance policy's remaining term are used to calculate what is called your insured life expectancy. Typically, a good investment will include policies with an insured life expectancy of about fifteen to eighteen years or less. The majority of settlements tend to have life expectancies between seven and twelve years. This means the best time to enact your settlement would be after age 70, but even as early as your 60s as well.

Insured Life Expectancy

The second basis for making an informed decision on the sale of a life insurance policy is the insured life expectancy. Your life settlement broker will use your life expectancy over the term of the life insurance policy to create a value for your policy. Investors looking to buy unit-lots of life insurance policies will assign a cash value to your policy based on insured life expectancy. Just as a real estate agent will help price a home to be sold based on the home's features and the current market, a senior settlement company will do the same to your policy based on insured life expectancy.

Policy

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