Has Anyone Sold Their Life Insurance?

[athena53]

Quote:

Originally Posted by bberris Correct, they don't have cash value. However, a term policy might have some value in the final years, if it is a level term policy.

Yes- as an example, if you've just taken out a 5-year level term policy for $100,000, there's a nonzero chance you could die within 5 years. If you're a 50-year old male you have a 3% chance of dying during the policy period using a mortality table on the SSA site. Neglecting any profit or expense loads, that policy would be worth 3% of $100,000, or $3,000, minus any premiums the investor would have to pay during those 5 years. Factor in premiums and expense and you'd get less than $3,000. I suspect that it would be worth it only on very large policies where the policyholder is in poor health.

[brett]

No. We never had whole life policies. We reduced our term insurance when our children left and when we became financially independent.

[MarieIG]

No, I have never contacted one of these places. Right now DH has a term, and I have a term through my new job, as I am otherwise uninsurable. When I was young and first married, I bought a whole life from All State. I kept sending in money, and the cash value never did rise above zero, so I cancelled it.

The "value" of a term policy such as yours depends largely on your health. Which involves turning over a great deal of personal information. For a healthy, say, in the range of 60 year old female, the value of your policy for the purchaser may be extremely small, if anything. Athena did the math . . .

It appears that the assumption is, if the purchaser is not honest, your only risk is financial

[bberris]

Quote:

Originally Posted by jazz4cash Gauss It makes sense except in the case of a term policy what happens if the term expires before the insured? I'm hoping the OP will contact them and give us an update.

Then the buyer of the policy loses. In related news, not all stocks go up.

[pb4uski]

https://www.thinkadvisor.com/2017/09...20180405212039

[Bryan Barnfellow]

Quote:

Originally Posted by SumDay Seniors Beware: What You Should Know About Life Settlements | FINRA.org

From the above article: "The amount you will receive in the secondary market depends on a range of factors, including your age, health and the terms and conditions of your policy—but it is generally more than the policy's cash surrender value and less than the net death benefit."

So, for once (older) age and (bad) health works for you!

-BB

[Chuckanut]

IIRC, many viaticals were sold to help Aids victims get some $$ to carry them through their last few years. However, AIDS treatments advanced at a quicker than expected pace and a lot of the buyers had to wait decades to finally collect. Personally, I never liked the idea of an investment that was directly tied to the death of a specific individual.

[brewer12345]

Life settlements are a thing and some of the states have even licensed agents to conduct them, similar to how they license agents to sell insurance in the first place. The buyers in this market will buy whole life, universal and term policies, but the last has to have a valid coercion option or guaranteed renewal. In general, the market (last I heard) was for people in their 70s, preferably in poor health. Personally, I find the idea of someone profiting off my death if it happens sooner rather distasteful, so I would be very reluctant to even consider selling a policy.

[Taxman59]

Had clients with policies that we tried to sell for them. The value of the policy isn't just the CSV, but also includes the buyer's estimate of the insured's life expectancy. A term policy can have great value if the insured is expected to pass in a relatively short time. Buying one policy makes no sense, but buying a basket of policies can be a good investment if you do a good job in the "underwriting" of the sellers.

[mickeyd]

Don't forget that this thing has to pass through many hands before they make you an offer. Each one of those hands need to be paid before the policyholder does.