Life Insurance Settlement Examples
Life Settlement Case Studies
Life Insurance Settlements are a new financial planning tool that can unlock value in an unused asset. Each Life Insurance Settlement case is different due to the fact that invidual factors play a huge role, including age, health, premium, face amount, cash surrender value, policy rating, and more. Each Life Insurance Settlement case is individually assessed and prices. Below are a few examples I have found. (I can not back up the validity of these cases).
Case 1
A 71 year old male with health challenges owned a $750,000.00 term policy* nearing conversion. Insured utilized a life settlement and received $185,000.00. This allowed him to complete the conversion to permanent protection.
*Term insurance is not permanent protection. In other words, the insured may outlive the coverage of the policy. In this case the insured had the option to convert to permanent insurance witout evidence of insurability. The funds received from his life settlement made this possible.
Case 2
A 79 year old female owned a $7,500,000.00 policy with a cash surrender value* of $30,000.00. Insured utilized a life settlement and received $1,200,000.00 and purchased a current generation life insurance product.
*In this case, the cash surrender value is the amount of money the savings portion of her policy had built up over time. This is the amount the insured would have received if she simply surrendered her policy to the insurance company. As you can see, the difference between surrender and a life settlement is substantial. Although she chose to by a current generation life product, the proceeds could have been used for any purpose.
Case 3
A 76 year old male owned a $3,000,000.00 universal life policy with a cash surrender value of $120,000.00. The original intent of the policy was to cover estate taxes on a property owned by the insured. The property was later liquidated and the policy was no longer needed. Insured utilized a life settlement and received $300,000.00.
Case 4
The trust of a 78 year old female owned a $2,550,000.00 universal life policy with a cash surrender value of $28,000.00. The clients trust no longer desired to maintain the policy due to its high premiums. The trust utilized a life settlement and received $495,000.00.
Case 5
A 79 year old male was diagnosed with coronary artery disease. His 20- year term was reaching its conversion deadline. He could not afford the conversion and letting his $250,000.00 policy lapse would leave him nothing. Utilizing a life settlement he sold his policy for $75,000.00 recovering all of his premiums and making a profit. He used the proceeds to pay off debts, take a vacation and add to his retirement portfolio.
Case 6
The trust of a 77 year old male owned several universal life policies totalling $13,000,000.00. The trust utilized a life settlement and received $2,500,000.00. The trust then purchased $27,000,000.00 of current generation universal life and variable universal life products.
Source: PolicyRefund
Life Insurance Settlements are a new financial planning tool that can unlock value in an unused asset. Each Life Insurance Settlement case is different due to the fact that invidual factors play a huge role, including age, health, premium, face amount, cash surrender value, policy rating, and more. Each Life Insurance Settlement case is individually assessed and prices. Below are a few examples I have found. (I can not back up the validity of these cases).
Case 1
A 71 year old male with health challenges owned a $750,000.00 term policy* nearing conversion. Insured utilized a life settlement and received $185,000.00. This allowed him to complete the conversion to permanent protection.
*Term insurance is not permanent protection. In other words, the insured may outlive the coverage of the policy. In this case the insured had the option to convert to permanent insurance witout evidence of insurability. The funds received from his life settlement made this possible.
Case 2
A 79 year old female owned a $7,500,000.00 policy with a cash surrender value* of $30,000.00. Insured utilized a life settlement and received $1,200,000.00 and purchased a current generation life insurance product.
*In this case, the cash surrender value is the amount of money the savings portion of her policy had built up over time. This is the amount the insured would have received if she simply surrendered her policy to the insurance company. As you can see, the difference between surrender and a life settlement is substantial. Although she chose to by a current generation life product, the proceeds could have been used for any purpose.
Case 3
A 76 year old male owned a $3,000,000.00 universal life policy with a cash surrender value of $120,000.00. The original intent of the policy was to cover estate taxes on a property owned by the insured. The property was later liquidated and the policy was no longer needed. Insured utilized a life settlement and received $300,000.00.
Case 4
The trust of a 78 year old female owned a $2,550,000.00 universal life policy with a cash surrender value of $28,000.00. The clients trust no longer desired to maintain the policy due to its high premiums. The trust utilized a life settlement and received $495,000.00.
Case 5
A 79 year old male was diagnosed with coronary artery disease. His 20- year term was reaching its conversion deadline. He could not afford the conversion and letting his $250,000.00 policy lapse would leave him nothing. Utilizing a life settlement he sold his policy for $75,000.00 recovering all of his premiums and making a profit. He used the proceeds to pay off debts, take a vacation and add to his retirement portfolio.
Case 6
The trust of a 77 year old male owned several universal life policies totalling $13,000,000.00. The trust utilized a life settlement and received $2,500,000.00. The trust then purchased $27,000,000.00 of current generation universal life and variable universal life products.
Source: PolicyRefund
posted by Life Settlement Pro at 8:18 AM
