What are life settlements?

advancedsettlements1A life insurance policy is a great thing to have. It ensures that your loved ones have a means of supporting themselves for a while, when you are no longer there to support them financially.Life settlements are basically conversions of life insurance where you receive the money while you are still alive.

Life settlements basically came about as a means of offering relief to those in financial trouble. Financial security is a problem for anyone and having a sizeable amount of money tied up in a long-term insurance policy is sometimes not practical. This is even more of a problem if you need money right now and there was no way of getting it without getting into debt.

The process of selling off your life insurance to a third party is called life settlement or senior life settlement. There are a few legalities that are associated with this process but it is nothing that life settlement brokers can’t sort out. However, you should understand that once this process is completed, neither you nor your beneficiary has any claim to the policy.

The benefit a purchaser gains is the policy and the bonus that the insurance company pays when the policy matures. The advantage for the seller is the immediate cash in hand. The loser in all of this is the beneficiary who will now probably receive nothing. The sale of a life insurance policy should not be taken lightly. It represents the removal of financial security for a loved one and therefore you should think twice before you do it.