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WHAT TO EXPECT WHEN ENTERING A LIFE SETTLEMENT TRANSACTION? |
For each policy you would like to submit for review, please
have the following documents prepared and executed by the insured and policy
owner:
- A Life Settlement Application - Also known as a viatical
settlement application, this form includes personal, life insurance, medical,
and policy information release forms.
- HIPAA Authorization - Must be signed by the insured - it
allows us to review all medical information as it pertains to your policy.
- Life Insurance Policy Information Release - Must be signed by the policy owner(s).
- Medical Records/APS - The insured(s) complete medical records
from all doctors and health care facilities within the past five (5) years must
be included.
- In-Force Illustration - The illustration must be
obtained from the issuing insurance company - to get the fastest service you may
want to contact your life insurace agent. The illustration should be run with
"level premiums such that the policy values are equal to zero" at the policy
maturity date.
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Once the policy has been received with all
of the required information, the life settlement process continues as follows:
- Policy Verification
- Insurance company must be rated
B+ or better by Moody's, S&P, and A.M. Best.
- Policy must be past
the contestability period.
- Policy must allow for absolute
assignment of ownership and/or irrevocable right to
designate beneficiaries.
- Purchase Procedure
- Completion of purchase
agreement.
- Deposit of settlement amount in
escrow account until closing.
- Closing
- On a case by case basis, we may
need to contact current beneficiaries, get signed
consent waiving or releasing beneficiaries' rights. - Policy is transferred to
purchaser. - Purchaser is recorded as a
beneficiary using a standard change of beneficiary form
provided by the
insurance company. - Escrow agent pays seller. - Purchaser receives a copy of
the transfer of ownership form and reassignment of
beneficiary form.
When the transaction is complete, the buyer
becomes the new owner of the life insurance policy, pays future premiums, and
collects the death benefit when the insured dies. The proceeds of the sale can
be used in any manner the seller sees fit.
If you would like to submit a policy to a company licensed to
purchase policies in Massachusetts, click here.
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