Questions and Answers - Life Settlements

How much money will I get if I enter into a life settlement contract?

The amount of money an insured or policy owner will receive depends on many factors including but not limited to:
  • AGE
  • MEDICAL CONIDTION
  • AMOUNT OF DEATH BENEFIT
  • LIFE INSURANCE COMPANY RATING
  • AMOUNT OF ONGOING COST OF KEEPING THE INSURANCE POLICY IN—FORCE (I.E. Premiums)
  • FEES RELATED TO THE SETTLEMENT (legal, etc)

What happens to my life insurance policy after I enter into a life settlement contract?

What happens to my life insurance policy after I enter into a life settlement contract?

The ownership rights and obligations under the policy are transferred to the new owner and a new beneficiary will receive the proceeds upon the death of the insured. This is an important decision that may have significant financial consequences for you and your family members. As such, you may want to include your family, accountants, and lawyers as part of your decision-making process before entering into a life settlement transaction.

Will my privacy be maintained?
During the application process, you will be required to sign an authorization releasing your medical information and other personal information. At Prosperity, the privacy of any health or personal information in our possession is very important to us. Prosperity will protect your private information and to that end restrict access to personal about you only to those employees and other persons who are required to know the information to enable Prosperity, its associates, or delegates to provide service(s) related to the sale and/or maintenance of your life insurance policy. Personal information, in addition to allowing us to give the best possible service, also allows us to establish your identity, protect us from errors or fraud, comply with the law and assess medical and policy attributes.

What are the alternatives to entering into a life settlement?

There are several options to explore, some examples include:
  • Borrow against the cash value of your life insurance policy;
  • Cash out the policy based on the available cash surrender value with the insurance company;
  • Check with the life insurance company to find out if the policy can be converted to a paid-up policy or if the death benefit can be reduced in order to lower the amount of your premium payments; and/or
  • Use the life insurance policy as collateral to secure a loan.

Are the proceeds of life settlements taxable?

Everyone’s financial situation is unique. You should consult your tax adviser for additional information related to the taxation of any life settlement.
How am I protected?
Your financial interests are protected in a number of ways, for example:
  • You incur no out of pocket costs! The funding institution that purchases your policy pays all of the transaction fees;
  • A policy owner is not obligated to sell at any time;
  • A third party escrow / trust company is used to hold settlement funds for distribution to the seller and agent(s) pending successful completion of the Life Settlement transaction in order to protect the buyer and seller during the contracting and policy transfer stages, similar to a home purchase transaction; and
  • Even after the settlement proceeds have been disbursed, your complete satisfaction is assured, as all transactions have a rescission period (generally 15 days).
Why should I work with Prosperity?
Prosperity’s mission is to offer superior services to the industry while maintaining the highest degree of integrity, dignity, and fairness. Through its affiliated companies, management, and staff. Prosperity has over 15 years of experience in the US Life Settlement Industry.

Why is there a market for life settlements?

The market exists because of the disparity between what insurers are willing to pay to buy back policies and what a seller can possibility achieve by a sale of their policies on the open market. The market price is often higher due to commercial realities i.e. face value minus premiums and price paid equals profit, where as the life companies only wish to buy back the residual value or premiums paid. Where there is opportunity to generate a profit, markets inevitably will appear.

What are the steps in the application process?

In order to determine any potential indication of interest from buyers for an in-force life insurance policy, Prosperity requires a completed Life Settlement Application and an illustration showing account values greater than zero until age 100. If a current illustration cannot be provided, we can request an illustration on behalf of the policy-owner once we receive the executed Authorization allowing us to do so.

What are some possible benefits of a Life Settlement?

  • Create more comfortable retirement years;
  • Eliminate or reduce future life insurance premiums;
  • Fund new needs (Annuities, Long-Term Care, Investments, etc);
  • A more profitable and bigger payout alternative than surrendering or lapsing the policy;
  • Fund a single premium Annuity/Life;
  • Settle personal or business debts;
  • Bestow cash gifts to family members or charities; and/or
  • Maintain a lifestyle despite changes in finances or health

How can I start the process?

We have setup an easy Life Settlement Application Form. After we receive your information, we will contact you if clarification is needed. Remember, there is NO obligation to accept a Life Settlement offer.

What if I have more questions?

No problem, we are here to help! Feel free to contact us by email at info@prosperitylifeinc.com

   

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