Top Questions Answered
Why would someone want to buy my life insurance policy?
Certainty of payout: In over 150 years of coverage, there has never been a death benefit not paid by the carrier. Certainty of death Laws of large numbers apply to allow the uncertainty of how long any given individual will live Investment is totally non-correlated to the stock market, politics, taxes, wars, weather, etc.
Why do 90% of all life insurance policies lapse?
Polices are not managed properly with annual reviews. Agents are not usually around after the policies are sold 80% of the time. Clients do not get good advice how to keep their policies or convert them. Client’s needs or desires change and they are unaware they have options to settle or sell them rather than let them lapse.
How much will it cost me to find out if my policy has “true value”?
We have a streamlined process to determine the value. There is a short data request form which can help determine if there is any value. For policies larger than $500,000 we recommend allowing us to obtain your medical records on a confidential basis, for the life expectancy report people to issue a report. Based on that report and the quality of your life insurance policy, the market will determine the value of your policy. We do not charge for this service- if we are successful in selling the policy for you- there is a success fee as a % of what we obtain. This method allows us to be totally have our interests aligned with yours, to get the maximum price we can for you.
Do I need to worry about who buys my policy- they will be hoping I die sooner?
Most buyers are institutional buyers like Warren Buffet, Hanover Re-insurance, and buy large blocks of policies knowing they enjoy the law of large numbers so no one is focusing on your individual situation. This process is regulated in the vast majority of each state and is a very transparent closely administered activity.
Will there be tax on my policy proceeds if I sell it?
Your basis will be equal to the total amount of premiums paid over the life of the policy minus the value of the insurance mortality portion you enjoyed during its coverage period. If the proceeds are less than that total basis, there will be no tax due. If the proceeds are higher than the basis, those profits may be taxed at ordinary income tax rates. (Please consult with your tax practitioner)
What ages is this usually good for?
Generally ages 70 and above It depends if there has been a health change since the policy was purchased. If that is the case, the exact age is less important
What type of polices does this work for?
The polices could be any type of permanent policy. The policy could ALSO be a term policy which is convertible to a permanent policy and the allowable period of conversion is still available.
What other services do you offer?
We offer consulting services where appropriate- if there are planning or tax considerations or estate or charitable goals. We help in the acquisition of new insurance product as well as helping clients rework their portfolios to best advantage Call or email us for a brief discussion, or fill out this form for some quick answers!
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