Long Term Care
Pay Down Debt
Improve Your Healthcare
Viatical/Life Settlement – Your Choice on What to Do!
But First…Before We Get Too Far into this Discussion… A Word about Viatical Settlements / Life Settlements – So what is a life settlement? Simply stated, a life settlement is the sale of a life insurance policy by a generally healthy insured/owner who no longer requires or can no longer afford the life insurance coverage. Prior to the advent of the life settlement transaction, such an insured/owner would be limited to the standard nonforfeiture options such as lapse, exchange to a reduced paid-up policy, or surrender for the policy cash value. All of these options involve a payout less than the policy face amount.
While still less than the policy face amount, a life settlement transaction can provide a substantially greater cash payout to an insured/owner than cash surrender. A study commissioned by the Life Insurance Settlements Association (LISA) using data from 11 Life Settlement firms for 2004-2005 found that an average of 371% of surrender value was paid.But such payouts are not without risk, as the consummation of the transaction requires turning over ownership of the policy to the investor who provides the cash distribution at the time of sale. The investor then continues to make premium payments over the life of the insured, with the payoff for the investor coming in the form of the policy death benefit.Source:Life Insurance Marketing and Research Association (LIMRA) Regulatory Review, Issue 2010-1, January 2010, page 4
Viatical settlements may also be referred to as life settlements. Whether a state uses the term viatical settlement or life settlement, they are essentially the same. Source:Viatical Settlements, Chapter 4, National Association of Insurance Commissioners (NAIC) Viatical Model Act
Suppose a Life Policy Face Value – $102,300
|$4,600 –||Policy Surrender Value|
|from the Insurance Company|
|$17,066 –||Viatical / Life Settlement Value|
|from the Producer/Buyer|
The Choice – Policy Surrender Value or Life Settlement Value
|Note:||Results may vary in the Policy Surrender value and the Viatical / Life Settlement value, though Viatical / Life Settlement values have been shown to exceed Policy Surrender values by 371%.|
Okay, Picking Up Where We Left Off…Use Your Life Settlement to Do the Following –
Delay Your Entry to Medicaid. With Improved Planning – You May Maximize the Monies from Your Life Settlement to Minimize Your Out-of-Pocket Expenses.
A Word about Medicaid –
- Medicaid may be the most expensive form of care.
- Medicaid may be a “budget buster”.
- You must “apply” and “qualify” for Medicaid.
Long Term Care. Use Life Settlement to Pay for your Long Term Care. In other words, You have an asset that will pay Your Long Term Care (LTC).
A Word About Long Term Care –
- It may be known as Long Term Care “Burden” due to its financial burden.
- Many Families are not preparing for LTC.
- According to Source: Nationwide Insurance, dated 17 June 2013– Only 11% of People over 55 years of age have Long Term Care Policies.
Independence. This one stands on its own. Through the Life Settlement, the financial return further assists your Independence.
A Word about Independence – It’s all about You – once You know you can sell Your Life Insurance Policy*. *Not all Life Insurance Policies are accepted for Sale. The types of Life Insurance Policies that are acceptable for sale are shown here. In addition, Your State Law specifies the minimum amount of time a Policy must be in-force before the Policy Owner is permitted to conduct their Life Settlement. As a guide – Click here for the list of States and their Life Settlement Waiting Period.
Pay Down Debt. With the monies received from Your Life Settlement, You are Free to use the monies for whatever you wish.
A Word about Debt –
- Debt hampers Flexibility.
- Debt Weakens Your Ability to Respond to Your Needs.
Improve Your Healthcare. Life Settlement gives Freedom to the Choice of Services, Level of Care, and Cash, if you so desire.
A Word about Improving Your Healthcare –
- Your Life Settlement will Buy you Time – Time that may be used for Nursing Care and/or any other Health needs / Insurance products / Considerations.
As You See, Life Settlement allows you to –
- Delay Your Entry/Use of Medicaid
- Long Term Care
- Keep your Independence
- Pay Down Debts
- Improve Your Healthcare
- Access More Cash Monies than Your Life Insurance Policy Surrender Value
Click here to learn more about how life settlements work.