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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?
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