Sell Your Life Insurance Policy with a Viatical Settlement
With a viatical settlement, you can sell your policy for more than you can receive by surrendering your policy to the insurance company for its cash value. The amount you may receive depends on a number of factors, such as your life expectancy, prevailing interest rates, and the sum of the policy’s future premium payments.
To qualify, you can be any age, but must have a medical condition that affects your life expectancy.
Reasons to do a viatical settlement…
- You need to pay medical expenses or other bills.
- Your income has changed and the premiums have become unaffordable.
- You no longer need the policy, whatever the reason.
Steps to take…
First, remember that at no time is there any cost to you, and you may cancel the transaction at any time before you accept payment from a viatical settlement transaction.
- You complete the form for your state on our Getting Started page to provide VSPI with necessary information and give us permission to gather your medical and insurance records.
- VSPI confidentially reviews your medical records.
- VSPI submits the information we gather to a number of financial institutions for their consideration. Based on the information we provide, the institutions present bids to buy the policy.
- VSPI presents the quotes to you for consideration. You are under no obligation to accept a quote.
Note: If you are receiving benefits from a means-based entitlement program such as Medicaid, VSPI urges you to do your homework and ask your legal adviser, financial planner, or your state’s Department of Health and Human Services for guidance on how those benefits may be affected by income from selling your policy.
- If you do accept the quote, the institution buying your policy places the purchase price in escrow for at least 15 days to give you more time to determine if a life settlement is right for you. You may cancel at any time before you receive the money from escrow.
- Once you accept the payment, the purchasing institution will become the new owner and beneficiary of the policy, and will take over the obligation of making all future premium payments. The institution eventually recoups its investment by receiving the policy’s benefits at the time you pass away.
Any type of life insurance policy can be considered for a life settlement, including term policies with no cash surrender value.
VSPI is not a financial planner, so we strongly recommend you work with your tax adviser to assess the policy’s tax basis and your settlement amount to determine what you may owe, since tax law is continually changing.
Read our Guide to Donating Your Life Insurance Policy to Charity if you are considering donating your policy to charity. Find out how the charity can receive the policy’s value today through a life settlement and avoid making any premium payments.
Read our Guide to Getting a Loan on Your Life Insurance Policy if you wish to retain ownership of the policy while using it as collateral for a cash advance now.