When you decide to sell your life insurance policy, instead of selling it back to the insurance company, you may want to consider selling it to a life settlement provider or a broker. Either way, it’s best if you engage with a professional who will help find you a suitable buyer and guide you through the selling process by making it as easy as possible.
The advantage of hiring life insurance settlement brokers is that they have access to many buyers who bid on insurance policies on behalf of the policy owners. If you work with a settlement provider, the middlemen are eliminated, and their ultimate goal is to get the best settlement in the best conditions.
Life Insurance Settlement Brokers:
The brokers will connect you to another buyer who is interested in gaining ownership of the policy. As a policyholder, you don’t have to worry about negotiating with the buyer directly.
The broker will do it for you, and they will choose a buyer that is perfect for your policy. Your job as a policy owner is to accept or reject the buyers that are brought forth.
There is a trusted bond that forms between the broker and policy owner; it’s mostly based on the fiscal decisions that the two parties make.
Here are some of the questions you can ask your life insurance settlement brokers:
- Do they have the necessary license required to function or do they use a borrowed license?
- Will they provide E&O coverage?
- Is there going to be any bid transparency?
- Will the broker receive any ownership interest in a buyer?
- Will the broker purchase the policy for their portfolio?
- How many years’ experience do they have as a broker?
- Does the broker follow the law?
- How does the broker protect crucial client data?
- How do they document the bids that are received?
- Has the broker ever been evolved in any litigation or legal problems that you should know about?
Ensure that you receive an answer to all the questions listed above from your life insurance settlement brokers. This way, both parties are on the same page, and data is transparent from the start.
Life Settlement Providers:
Life settlement providers are part of the life settlement market, and they usually deal with raising capital from investors. Work directly with the policyholder and not with any intermediaries; this way, they speed up the transaction process as well.
When you’re dealing with a life settlement provider, here are some of the questions you can ask:
- Is the settlement company and provider licensed and qualified to get the job done?
- How many years have they been in business?
- Are they reputed and do they have a good client base?
- What kind of buyers can they get you and will they be capable of handling the premium costs in the future?
- Will they ensure that the client understands who the policy owner becomes?
- How likely is it that the insurance will be resold to another buyer and what kind of buyer will it be sold to?
- How much personal information will remain confidential?
- Can the policy owner keep a part of the policy’s benefit after it’s sold?
Which should you choose?
When policy owners look for a good platform to sell their insurance policy, they usually approach a Life Settlement Broker vs. Life Settlement Provider or a settlement provider. A broker can tell you to abandon all the measures to sell them yourself, and they will collect your data and find you a bucket load of potential buyers. They ensure that you find the perfect buyer for your policy.
Now whether you go to a broker or provider, either one of them will have to put in money to an extent. This will involve getting medical records from your physicians and gaining information from your insurance company, mainly to purchase the life expectancy report.
Copying data from your medical records and life expectancy reports takes up lots of money, which can go up to $500. Buyers who are enlisted with settlement companies will make the same offer to the seller that they would make to the broker to ensure that no there are no inaccuracies at the end of the year and that all the cases are treated in similar ways.
If you’re looking to gain money from selling your insurance policy, as mentioned before, you can go two ways; hire a life insurance settlement brokers or a life insurance settlement provider. Either way, you need to make sure that the platform you choose is a trusted and reputable one and will give you the results that you desire.