Select Life Settlement Corporation Celebrates Life Settlement Awareness Month
(The Times of Northport, June 28, 2007)
As we end the month of June and Life Settlement Awareness Month, we are featuring another case of how a life settlement helped a family. A life settlement involves the purchase by a third party of a life insurance policy which has become unnecessary or unwanted. This installment is from Bob Vandy, Director of Business Development for New York Long-Term Care Brokers in Clifton Park, NY.

“Select Life recently helped us close a great life settlement case which epitomized how valuable life settlements are for our clients. The insured, Bill, an 89-year-old male, was actually referred to us by his attorney and was in the process of relocating to a nursing home and making sure his affairs were in order, given that substantial change in his life. His life insurance policy, an $800,000 Universal Life policy owned by the client's Irrevocable Life Insurance Trust (the client's daughter, Maureen, is the Trustee), had a current Cash Surrender Value of about $78,000. If the current premium of approximately $50,000 per year had continued, the policy would have lapsed within 1-2 years. In order to carry the policy out to age 100, the premium would have more than doubled!

After considering several factors, it was determined that a life settlement was the solution. Select Life put the policy out to bid and generated several attractive offers for Bill and Maureen, the highest of which was $390,000 and was ultimately accepted by them. The end result? Bill and Maureen were ecstatic because she as Trustee would not only no longer have to pay premiums for a policy which had outlived its usefulness, but also not have to pay twice the premium just to keep the policy in-force to maturity. And, rather than simply accept the surrender, they received $390,000, five times the surrender value! As Trustee, that gave Maureen the flexibility of then using those funds for other purposes (subject to the terms of the Trust) which may not originally have been contemplated.”