How To Take Advantage Of Life Insurance Settlements

Life insurance is one of the best policies that you can get from your insurer. Provided that you get the right deal from your contract. Think of it as a written promise that your family will be taken care of financially if anything happens to you. There may be times where you feel that you might not need it anymore and want to fully take advantage of your life insurance settlement the right way. 

Here are some benefits of this settlement and how it can help you and your family.

Quick Cash Payout

One of the best ways to take advantage of the perks of this policy is to sell it for a decent settlement. They call it the “Viatical Settlement” and you basically sell your life insurance policy for an amount less than the death benefit, but it’s higher than your cash surrender value. This buyer would take over the responsibility of paying the premiums instead of you and they will get the death benefit when you die, but you will get a nice payday upfront after the sale.


You can get a decent amount of cash by selling your policy for your retirement. Sometimes paying the installments might cause negative cash flow if you’re living on a fixed income that is just not enough to allow you to live comfortably. The life settlement specialists at believe that surrendering your policy back to the company for the cash surrender value can be a great option. You will receive all the remaining cash value, but it will be a bit lower than the total amount of cash value in the policy. This is because of different fees and surrender charges, but it’s worth it because of the big payout. You can create value that will give you additional funds to have an easy and comfortable retirement.

Let It Lapse

Another way to benefit from a life insurance settlement is by lapsing your insurance. This only works for the people that have no need for coverage to protect their family or their kids are older now and don’t need financial security anymore. Also, it works if your original policy has a non-forfeiture clause, meaning that you will get the policy’s cash value if you sell it. So, you can choose to sell the policy when it’s nearing its end period and just about to lapse to get a decent payday. There won’t be a cash surrender value when it lapses, and you can invest the money in a project or dream of yours.

Critical Health Conditions


When people realize that they are terminally ill and their health is deteriorating quickly, then there is no point to wait for the death benefit because you might not get it. This scenario is sad, but it would be smart to sell your policy before it’s too late. Chronically ill patients can get coverage while they’re still alive if they sell now for a settlement. What they might earn would be much more than they expect and could help them with medical bills or to lead a comfortable life during their illness. This process is also called an accelerated death benefit when you’re terminally ill and need the funds quickly.

Utilizing Brokers for a Sale

Some companies might be interested in your life insurance policy, but you can’t get in touch with these companies or open a dialog without the help of a broker. They can help with the paperwork and get the procedure going so you can make the sale. You might have to pay for their services, but it’s worth it if you will get a payday from selling your insurance policy. They basically list your policy and have other brokerage firms place competitive bids on it. This increases your chances significantly to find a buyer and sell it. You don’t have to worry about any legal issues because this process is regulated by the state authorities. So, you can rest assured that everything will be done appropriately and safely.

This policy isn’t perfect for everyone and it depends on individual needs and situations. If you don’t have children or an heir, then you shouldn’t waste your money with the installments for this policy. The financial obligations are too great and would be pointless if there wasn’t anyone in the equation to benefit from it or if you can’t continue paying the installments. So, make sure you made the right decision and fully understand the repercussions of selling the life insurance policy when it’s not needed.