Life Settlements 101

As most financial professions know, the life insurance market is extremely competitive and as a consumer, gaining an advantage can be difficult. Luckily, the life settlement market has proven to be a viable option for those who are looking to for an exit strategy from their life insurance policy. Life settlements are the sale of an existing life insurance policy for more than the cash surrender value, but less than the net death benefit.

Although it is widely underused, the life settlement industry has been around for quite some time. It has been successfully utilized for more than 30 years; however, it is often brushed over in favor of other methods that are more recognized. You may be wondering why that is and the answer is quite simple. It is because many life insurance agents, investors, and financial advisors are either uninformed or misinformed about the life settlement market which has ultimately resulted in a lost opportunity for their clients.

The life settlement industry is now starting to grow rapidly as more professionals and consumers become aware of the benefits life settlements can offer. In order to insure that all parties involved are protected, there are strict government laws that regulate the life settlements practice in most states.

One of the best benefits of life settlements is that individuals who sell their life insurance policy are likely to procure more than the cash surrender value that the insurance companies yield. In addition to being able to pocket money from the sale of a life insurance policy, there are also several other reasons why life settlements are beneficial. Individuals who can no longer afford the life insurance premiums may find financial relief by selling their policy, as opposed to allowing it to lapse and not being able to take away a dime. Some people also chose to sell their life insurance policy if they simply no longer need or want to policy.

Ultimately, life settlements can play various roles in the lives of those who utilize them. They can act as a safety net for individuals who are drowning in financial troubles, a profitable tool for those looking to invest in a secure and unique market, and a rewarding alternative for those who simply no longer have a need for their life insurance policy.