>U Mom Knows Best: Understanding Life Insurance Settlement Options

Wednesday, February 13, 2019

Understanding Life Insurance Settlement Options

Today’s blog post on Mom Knows Best is about understanding  life insurance settlement options as part of a sponsored post with Mason Finance

  Having life insurance is always a good thing as it is a way to protect the ones that you love after you pass away. You never know when an emergency might take the life of someone, so being prepared for an emergency is always a good thing. Having life insurance is a piece of mind that the ones you leave behind will not have to worry about things like bills and other things. Like everything, it has its season and the day might come when you feel you no longer need that life insurance policy. If you, decide that your life insurance policy is no longer needed, then maybe a life insurance settlement may be the answer. When my husband became the caregiver for his dad, we discovered that his dad had an unneeded life insurance policy on his deceased wife. His dad could no longer afford the rising premiums as he needed his money for retirement expenses and health care expenses.

What is a life settlement?

  A life settlement is the sale of a life insurance policy to an investor for an amount more than the policy’s cash surrender value, but less than the death benefit, or payout value to the beneficiaryIt is simply a transfer of a life insurance policy to another person who takes over the premiums of the policy and becomes the new owner to the policy. The former policyholder receives a cash payment that is larger than the surrender value of the policy.

Read on to learn more about life insurance settlement options

Am I eligible for a life settlement?

 You may have a policy that is no longer needed and you would like some cash for bills or retirement. The first thing that one needs to do is to first see if your life insurance policy is eligible to be sold to an investor for cash. Things that investors look at before buying a policy is the age of the person and

 Age/Health: Is the policyholder 65+ or have a serious medical condition?

Policy Type: Is the policy universal, whole, and convertible term? These are all great candidates for a life insurance settlement.

Policy Size: Does the existing policy have at least $50,000 of face value?

Reasons to sell my life insurance 

  You may be wondering why you should sell your life insurance policy. Some of the reasons people sell a policy are due to the fact they can no longer afford the premiums or they no longer need to protect the spouse or children on the policy. Perhaps the policy is approaching its expiration date or you are looking to supplement your retirement. You may also need money to pay unexpected medical bills. These are just some of the many reasons people sell their life insurance policies. Before you sell your life insurance policy, make sure to check out the pros and cons of a Life Settlement. You may be getting some much-needed cash but it may affect things like taxes and Medicaid.

Is a life settlement right for me?

 The first step to determine if a life settlement may be talking to your life insurance agent to see if your policy can be transferred or sold to an investor. Then look at all the available options. Make sure to look at the pros and cons before you decide to sell. A life settlement may be a good option for a loved one that you take care of.

Do you have a life insurance policy that is no longer needed?

When you decide the time is right and you want to sell a life insurance policy, it is always good to do some research. One needs to know the life insurance settlement options that are available before they decide to sell a life insurance policy. 


Sarah Bailey said...

This is a great post and is going to be such a help to people who are trying to work out life insurance - it can be so confusing after all.

Joan said...

I haven't thought about life insurance and I know that I should probably have checked into it. This is a great post reminded me the importance.

AiringMyLaundry said...

My husband gets life insurance through the military at the moment. But when he gets out, we'll have to check out other options.

Passion Piece said...

Life insurance is very important, but sometimes it's difficult to go through all these papers. This article will be very helpful for me! :)

Chad said...

I really had no clue about the topic! Thank you so much for explaining it this thoroughly. This is great.


Ophelia Tang said...

This is a great introduction to life insurance. Your post taught me a lot. Thanks for sharing.

The Super Mom Life said...

I know nothing about life insurance, I'm ashamed to admit. I really need to look into it.

Princess Quinn said...

This is a well informative post to tackle. I've learned so much about after reading. Clearly all about understanding it better and making right decisions.

Becca Wilson said...

This was some really great information. Life insurance is something that we have never really looked that much into before.

Dalene Ekirapa said...

Life insurance is so important, especially in case of emergencies. Anyway, I'm learning a new concept here- so life insurance can also be sold? Wow!

latte lindsay said...

life insurance is so confusing, thanks for shining a light on the topic. More people need to learn about their options when it comes to protecting themselves.

Swathi said...

This great post I didn't know much about life insurance. This post shed some light yes we need to know about our options to protect ourselves.

Hannah Marie said...

I know having a keen understanding about it is really essential. You might ask guidance from others if confused. Once you know how to, it will be easy as 1 2 3.

Alyzza Sanchez said...

I am planning to get insurance and this is a good read.

tannawings said...

We both need insurance :/ Getting it when you are older is tough to find one that isnt an arm and a leg.

Enriqueta E. Lemoine said...

I need life insurance. This is so important to be prepared for an emergency and at the end: not to become a burden for your loved ones.

Bindu Thomas said...

I am planning to get insurance and this is a good read. I really need to look into it.

Becca said...

Interesting post – some great tips and advice here! I will definitely have to take some of this on board next time I am considering life insurance x

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