Planning area

Life Settlements

An asset — not an expense.

Life Settlements policy documents

Why consider one.

  • The premium is no longer affordable or worth paying
  • The coverage is no longer needed for its original purpose
  • The insured's health or life circumstances have changed
  • The policy is underperforming its original illustration
  • Estate liquidity needs have shifted away from the death benefit
  • Business succession or a buy-sell agreement has changed
  • A trustee needs to evaluate a policy for fiduciary reasons

Who qualifies.

65+

Typical minimum age

$500K+

Typical minimum face amount

Health

A change since issue often qualifies a policy

I. The risk has passed

The reason the policy was purchased no longer applies.

II. A change in people

A divorce, buyout, or change in beneficiaries has changed the need.

III. The plan has shifted

The estate or business plan the policy supported has evolved.

How the process works.

  1. Inquiry package & policy review
  2. Life-expectancy underwriting
  3. Case is brought to the settlement market
  4. Bids are collected from licensed buyers
  5. Best offer is presented for approval
  6. Purchase and sale agreement is executed
  7. Change of ownership and beneficiary filed with the carrier
  8. Funds are placed and verified in escrow
  9. Escrow releases funds at closing

Retained death benefit.

Selling the policy is not the only option — some structures let the insured retain a portion of the death benefit.

Option A

Retain a fixed portion of the death benefit while monetizing the rest.

Option B

Convert proceeds into a retained-benefit or long-term-care-linked structure.

How proceeds are taxed.

Tier Portion Tax treatment
Tier 1 Return of basis Tax-free — proceeds up to your cumulative premiums paid
Tier 2 Basis to cash-surrender value Ordinary income
Tier 3 Above cash-surrender value Long-term capital gains

Audit & Valuation

We review the in-force illustration and current carrier data before recommending a course of action.

Fair Market Valuation (FMV)

An independent valuation supports fiduciary decision-making for trustees and plan sponsors.

Ready to discover what your policy is really worth?

Let's review the opportunity together.

Schedule a confidential case review

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