The life settlement industry came to being around the 1980s when the AIDS epidemic hit the US. AIDS patients who had a very short life expectancy and owned a life insurance policy didn’t feel the need to retain the policy. This was when viatical settlements were introduced. While viatical settlements greatly benefited people with a terminal illness, as better treatments for these terminal illnesses were introduced, viatical settlements soon became less common.
Now, senior citizens with life insurance policies who feel like they don’t need their policy anymore have the option of seeking a life settlement by selling their policy. While the benefits of viatical settlements are quite clear, people still don’t quite understand in what ways a life settlement can benefit them. One of the natural concerns when people ask “can I sell my term life insurance policy for cash” is if a life settlement would be beneficial. So, here’s a list of benefits of getting a life settlement so that people can rationally identify their need for a life settlement.
HIGHER CASH VALUE THAN SURRENDER VALUE
One of the traditional ways of dealing with a policy that is not required is by surrendering it to a life insurance company and getting a surrender value for the policy. One big reason why getting a life settlement is a better option is that the cash value you get upon selling your life insurance policy for a life settlement is way higher than the surrender value your life insurance company would offer. People who sell their policy for a life settlement have the chance of receiving about four times more cash than that offered when they surrender their policy.
NO MORE PREMIUMS
The most common reason why people think about selling their life insurance policy is that the rates of premiums keep increasing as time goes by. Among all the big and small financial aspects seniors have to take care of, premiums become a real financial burden. Moreover, when that happens, selling the policy for a life settlement is regarded as the best alternative.
When you sell your policy for a life settlement, you get a lump sum. Additionally, after the transfer of ownership, the buyer starts paying the premiums until he gets the death benefit.
If you have debts or a loan to pay off and you’re wondering, “can I sell my term life insurance policy for cash,” yes, you can. In times when you already have debts or loans to handle, you can’t really pay for the premiums. Furthermore, upon selling a life insurance policy for a life settlement, you get cash instantly. This cash can be used to pay off debts, and the remaining money can be used to meet other expenses.
After you retire, if you wish to have a small income to take care of your daily expenses, selling your life insurance policy for a life settlement would be an economical idea. The money you get in return for selling the policy should be enough to invest in a small business. If not a business, you can even invest this money in property, like a piece of land or something that can either be useful for you or your beneficiary later.
One of the benefits of selling a life insurance policy for a life settlement is that seniors who don’t have a job that gives them a pension can have financial support to take care of themselves after retirement. If you live in a rented space and have a pet to take care of, you know life after retirement can become hard to afford. In a circumstance like that, the cash you get from a life settlement can help a great deal.
TAKE A TRIP
Getting old can never be an excuse to stop having adventures. In fact, a trip after you retire can be rejuvenating; taking your mind off the fact that your life changes after you stop working. In fact, trips can make it easier to deal with the transition from working to not working. However, trips are costly. If you have a policy and you think it’s not needed anymore, you can sell it for a life settlement and spend the cash on taking a meaningful trip to a nice place.
Many people who ask can I sell my term life insurance policy for cash know life settlements exist. However, the above-mentioned benefits add more meaning to getting a life settlement.