Do Financial Professionals, Life Insurance Agents, and Brokers have a fiduciary responsibility to inform their client’s on the benefits of a life sett

Well you may want to consider the following scenario:

Your client no longer needs his $1,000,000 life policy and would like to surrender the policy for its cash value. The client contacts you to start the transaction, you have a basic understanding of life settlements, but instead doing more research and talking to a life settlement expert, you assist your client in surrendering his policy for a total of $75,000. Sometime later your client is talking to friends at the country club and hears that their financial advisor got them over three times the surrender value for a similar policy. When your client asks, “Why wasn’t I given the option of a life settlement,” what will your response be?

If you had considered all of your client’s options you could have possibly gotten him $300,000 or more for his policy and had a very happy client. Instead now you have a disgruntled client or maybe even worse. Not only have you lost any future referrals or business from this client you may be at risk because of your knowledge of life settlements.

Life Insurance Agents/Brokers and Financial Professional have the opportunity to make available to their clients the benefits of the secondary market for life insurance. Life settlements are becoming commonplace. Why? Because the offers presented to your clients may be significantly higher than the current policy surrender value. In the past, policyholders had two options: surrender value, or let the policy lapse. Now you can offer your clients a third option - the sale of this value asset in the secondary market to the highest bidder.

What are your thoughts?

Life Settlements are becoming commonplace.

Life Settlements are becoming commonplace. Why? Because a life settlement, can give a policyholder the option to convert an unwanted life insurance policy into a lump sum settlement instead of lapsing the policy or surrendering the policy for its current surrender value.

Today’s policy owner’s can sell their life insurance policy in the secondary life insurance market to the highest bidder. Most often, the offers received may be significantly higher than the current policy surrender value.

Say, you no longer need your life insurance policy and would like to surrender the policy for its cash value. Instead consider, taking your policy to a life settlement broker and go through the easy process of selling your policy. A Life Settlement is the sale to a third party of an existing life insurance policy for more than its cash surrender value but less than its net death benefit. A Life Settlement refers to a transaction involving an insured that is generally over the age of sixty-five (65). The value of a life insurance policy is determined by a number of factors, including, but not limited to, the age and medical condition of the insured, type of insurance policy, rating of the issuing insurance company and amount of premium payments to keep the life insurance policy in force. Most types of life insurance policies can qualify, however, the most common are Universal Life, Whole Life, and convertible Term Life and there are no restrictions on use of the funds – the money is yours to spend as you like.