As you age, your life insurance needs may change from what they used to be. Whether you have different coverage needs, a tighter budget, or increasing premiums, or decide you could do without life insurance now, you have better options than lapsing or surrendering your policy. Many policy owners are unaware of their options regarding life insurance, resulting in smaller payouts and keeping policies that are no longer beneficial.
Before you let your policy lapse or surrender it for cash value, discover and understand the alternatives to get the most value for your life insurance policy.
You may lapse or surrender your life insurance policy for numerous reasons. While every situation is different, here are a few common reasons life insurance policies get surrendered:
Before deciding to surrender or lapse your life insurance policy, you should understand and consider the alternatives. Here are a few ways to make the most of your life insurance policy without lapsing or surrendering it:
Despite hundreds of thousands of life insurance policies being surrendered yearly, it is typically not the most beneficial option. Life Settlements are one of the best alternatives to surrendering your life insurance because of the significant payout. Consider how Life Settlements are effective alternatives to surrendering your policy.
Life Settlements involve selling your life insurance policy to a third party. Many policy owners are unaware that their life insurance policies are personal property, meaning they can sell them if the policies are eligible. Life Settlements will pay out a percentage of the policy’s death benefit. The value of your life insurance policy depends on multiple factors, including the policy’s conditions, your age, and health. Life Settlement payouts are generally less than the full death benefit and more than the surrender value.
Another aspect affecting your payout is how much your premiums cost. Your policy buyer will pay your settlement amount and continue making payments on the policy for the rest of your life. In return, they will receive the death benefit payout.
Life Settlements give you more options for your life insurance policy. Whether your current policy is obsolete, your insurance provider offers no other beneficial alternatives, or you simply want more for your policy, Life Settlements are the best way to avoid surrendering your life insurance policy in many cases.
Working with a Life Settlement provider is one of the best ways to get the most value for your policy. Many Life Settlement providers work to match you with potential buyers with big payouts. Finding a buyer on your own can be challenging, and you may not get the full potential for your policy. Professional services help ensure your policy is valued appropriately and sold to the right buyer.
You will also need to determine if your policy can be sold. Some life insurance policies have conditions that prevent you from selling them. You also must meet certain eligibility requirements for a Life Settlement. For example, you must:
If you’re eligible for a Life Settlement, sell your policy as soon as you can. The sooner you find a buyer with a high payout, the sooner you will avoid lapsing or needing to surrender your life insurance policy.
At Settlement Benefits Association, we are dedicated to getting you the most value for your life insurance policy. We represent you as the seller, working to find you a buyer with the highest payout. If you are considering surrendering your life insurance policy, we can help you determine if now is the right time for a Life Settlement. If you are eligible for a Life Settlement, our team will evaluate your life insurance policy to estimate how much your settlement could be.