Life Settlements - Another Option to Consider

Two options typically exist for a senior having a life insurance policy that is no longer needed or which they can no long afford to maintain. Those two options were:

1. Let the life insurance policy lapse; or
2. Cash-in the policy for its surrender value.

Now with Prosperity Life Inc. and the option of a Life Settlement, seniors have an opportunity to capitalize on their current life insurance policy by allowing them to cash in their life insurance in a new way! Rather than cashing in their policy with their life insurance company, they can work with Prosperity to cash in their policy with a Life Settlement Purchaser that will pay more than their insurance company for the life insurance policy.


Possible Reasons to Consider a Life Settlement

• Enhance quality of life • Have excess life insurance
• Current policy is underperforming • Other Estate Changes have taken place
• Premiums are no longer affordable • Long term care needs to be funded
• Beneficiary has passed away and coverage is no longer needed • People are living longer and clients may be able to sell their policy and acquire a more appropriate product.
• Desire to receive more than the Cash Surrender Value offered by the Insurance Carrier • The money obtained through a life settlement can be used to better fund other investments, pay bills, vacation, or bequest to beneficiaries while you are living

In our Clients section we will inform you of the type of policies we will review. Policies purchased by investors generally involve policies issued on the lives of individuals with life expectancies greater than 2 years but less than 15 years, due to requirements of potential purchasers.


General Market Analysis (Quebec)

Year end 2005
Total Amount of Life Insurance Owned
Number of Policy Owners
Average Amount of Coverage
Amount of Individual Coverage
Amount of Group Coverage
Quebec
$ 617.0 Billion
5,300,000
$ 116,300
58%
42%

Source: Facts & Figures: Life and Heath Insurance in Canada. Canadian Life and Health Insurance Association Inc. 2006 Ed.


Do you have any contracts that will lapse in the next two (2) years?

FACT: 88% - Percentage of UL policies that never mature in a claim!

Have you or any of your clients surrendered any policies to the insurance companies without appraisal for value in the secondary market?

FACT $ 108 Billion – Total amount of life insurance with market value exceeding surrender value. Do you really know what the value is of the life contracts in your current files?

Summary = All 65 + aged persons should have their life insurance appraised to determine its market value. This is what Prosperity is here to assist you with!

FACT: Policy owners can realize significantly more than the cash surrender value for unwanted insurance by selling their policies on the secondary market.

FACT: Nearly 9 out of 10 UL policies never mature in a claim. Traditionally, policy owners have had only one buyer – the Life Insurance Company.

FACT: The insurance company told you what they were going to pay for the redemption of that policy.

The advent of a secondary market has created a free market for life insurance where insured’s and policy owners can consider competing offers for their unwanted policies. As a result, consumers now have the power to capture the value contained in their life insurance policies and to put that value to the best possible use.

 

   

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