While taking out a life insurance policy always seems like a good idea at the time, your life circumstances can change such that continuing to pay premiums no longer makes sense. For example, if you do not have dependents, or if your dependents would not face financial hardship if you passed away without a life insurance payout, it may not be the best move to hang on to your life insurance policy. Assess if your family can keep up with payments such as a mortgage, student loans, and car payments without harming their standard of living. In addition, you may not be able to afford to pay your premium any longer. If you cannot afford to pay your premium, selling your policy may be an attractive alternative to simply letting it lapse, depending on the value of your policy.
But a life insurance policy that no longer makes sense for you and your family may not be worthless. Instead of letting the policy lapse or expire, consider selling your life insurance policy. In a life settlement, you can transact on the secondary market with investors to sell part of or all of your life insurance policy for cash. Payouts can vary significantly, so selling may not make sense in all circumstances. Speaking with a financial advisor can help you assess all of your options.
Do I Qualify to Sell My Policy?
If you are over the age of 65—and especially over the age of 70—or have had a recent unfortunate change in health diagnosis, you are more likely to find a buyer for your policy. High-value policies, such as those with a death benefit payout of at least $100,000, and policies issued by well-rated life insurance companies are also most attractive to investors. Policies with flexible or low premiums, to minimize payments the investor will have to make on the policy, are also preferred.
To sell your life insurance policy, reach out to someone who knows how the process works. A reputable broker can advise you on every aspect of a sale. You will want to get multiple offers, as negotiating is encouraged and helps maximize your cash payout, and you should be aware that the process may take a few months. You will also want to make sure you have all the necessary paperwork, such as a medical history, in order to successfully sell your policy.
Speak with a Boulder, Colorado Estate Planning Attorney for Help Answering Your Questions
Attorney Diedre Braverman is licensed to help our clients sell life insurance policies they don’t need anymore, or they don’t want to keep paying premiums on. She’s also a CERTIFIED FINANCIAL PLANNER™ qualified to coach our clients on investments made with the proceeds from the sale of their policy. For all other estate planning needs, the Braverman Law Group has years of experience crafting plans for our clients. To schedule a free, no-obligation consultation with one of our trusted attorneys, give us a call today at (303) 800-1588.