10 Essential things you must know about a Life Settlement
#1 Is it OK to buy and sellLife Insurance policies?

Yes. Remember that once a life insurance policy is issued and put in force, it is the property of the contract owner. Much like any other asset, the policy owner has the right to dispose of the policy in any manner that he or she may choose after the contestability period has passed.

Options may include holding the policy until maturity, surrendering it for its cash value, lapsing the contract, or selling it for an amount higher than the cash value and less than the policy face amount.
Essentials to Selling your Life Insurance Policy continued
Why Choose ILSA
  1. How does a Life Settlement work?
    1. The insured or the contract owner, if different than the insured, submits an application to Life Equity Partners Advisors.  LEP will obtain an in-force illustration of the policy from the insurer showing the face amount and any outstanding loans and premiums due.  Life Equity Partners Advisors also obtains copies of the insured’s existing medical records from the insured’s physicians.  No medical exam is necessary for the insured.  Life Equity Partners Advisors reviews the records to determine if the insured meets the necessary criteria to make an offer on the policy.  Once an offer is made and accepted, the life settlement transaction is documented and proceeds to closing.  An escrow agent ensures that the policy’s owner receives the purchase price offered.  The policy’s seller has the right to rescind the transaction within 15 days (in most states) of the receipt of funds so long as the purchase price and any premium paid are returned prior to the end of the rescission period.
  1. Is the process confidential?
    1. Yes.  All LEP personnel are guided by the highest standards of confidentiality.  No medical, financial, or other personal information about the seller and/or the insured which Life Equity Partners Advisors obtains will be disclosed to any other person or entity without written consent, unless required by law.
  1. What if I change my mind?
    1. Most states require a 15-day rescission period.  As the previous policy owner, you can change your mind and get the policy transferred back to you within fifteen days after receiving your funds depending on the state.
  1. Who pays future premiums and are there any restrictions on the proceeds?
    1. The institutional purchaser becomes the new owner and covers all future premium expenses.  The process is quick, easy, does not require a medical exam, and best of all sellers are free to use the proceeds however they wish.
  1. Do I need to take a medical exam?
    1. No.  LEP will contact your physician for existing medical information.
  1. What type of policy will LEP purchase in a Life Settlement transaction?
    1. Life Equity Partners Advisors will purchase most types of policies including Term Life Insurance, Universal Life Insurance, Whole Life Insurance, Joint Survivorship Life Insurance, or Key Man Life Insurance.
  1. How long does it take to complete a Life Settlement transaction from start to finish?
    1. LEP goal is to complete most transactions within 30 days.  The most significant factor is the gathering of the insured’s medical records.  Sometimes, obtaining complete and accurate data regarding the insured, seller, insurance company and/or policy may take some time to accomplish and can slow down the transaction.  Life Equity Partners Advisors works diligently to speed up the process and will keep in constant contact with the seller or seller’s representative throughout the entire process.

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  1. How much will the owner be paid for the policy?
    1. The amount to be paid to the owner of a policy depends upon various factors such as medical condition, age of the insured, amount of future premiums due to keep the policy in force and the cash surrender value of the policy. LEP has had offers over 50% of a policy’s face value.
  1. Is there any cost or obligation?
    1. No.  There is no cost or obligation to the seller.  In fact, LEP does not even charge an application fee.

These essential components comprise a basic understanding of how the life settlement process works.  For additional information, please contact us.

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