The Life Settlement Calculator – How the Calculations Work “Under the Hood”

If you’ve ever used a life settlement calculator tool to estimate the resale value for a life insurance policy you want to sell, you may have wondered about the various factors that are considered in a life settlement transaction. This article may help you decide whether selling your life insurance policy (known as a life settlement or viatical settlement) is a good fit for you or your loved ones.

Why Should You Consider a Life Settlement Offer?

  • If your insurance policy is too expensive to continue with the premium payments and you are considering giving up the policy, you should see if it has value to a life settlement provider or a life settlement broker.
  • If you don’t need your policy for the reason you first got it, you should see if a life settlement provider or life insurance broker can convert that life insurance policy into money you can use for your current needs or wants.
  • If you need money for immediate needs such as medical expenses or medical bills, then selling your life insurance policy for the fair market value might be a good source of those funds. A life settlement provider can determine the value of your policy.
  • If you want to fund a long-term care plan, the sale of a life insurance policy can be used. Some life settlement providers or life settlement brokers can assist with this. As a leading life settlement company in the industry, this is a specialty of Q Life Settlements.

What Information is Used by a Life Settlement Calculator to Value My Policy?

The value of your policy will be based on several items.

  1. How old are you? The older you are, the more value there is in your coverage at resale./li>
  2. Are you male or female? Since women typically live longer than men, policies on males are valued higher due to the shorter life expectancy.
  3. Is your health, compared to others of similar age, excellent, very good, average or poor? The value of your life insurance policy depends, in part, on a professional estimate of your life expectancy. Your health helps determine the result of that evaluation.
  4. What is your policy’s value? The larger it is (e.g. death benefit), the more valuable it will be at resale, all else being equal.
  5. What type of coverage do you have? The most valuable policies are universal life (flexible premium) policies. Other policy types, including whole life insurance and term life insurance, can also have value and we are happy to value those types as well.
  6. Who is the life insurance company? Policies issued by insurance companies with the highest quality ratings have the highest values. Because of the generally high quality of the United States life insurance companies, policies from almost all US life insurance companies can be valued.
  7. Is the insured a US citizen? Is the owner a US citizen or company? At this time, we can only work with life insurance policies on US citizens and from US citizens or companies.
  8. Does your plan have cash value? The value of a life insurance policy is primarily based on the death benefit (face value) of the plan rather than the cash value. If your coverage has little or no cash value, it still may be very valuable.
  9. What premiums must be paid to keep your life insurance policy in-force (still effective)? The lower the premiums which must be paid in future years, the more valuable your plan is.
  10. Does your coverage have a loan against it? Coverage with policy loans can also be purchased, but the amount you would get paid would be offset by the loan amount.
  11. Do you only want to sell part of your coverage? We can help you achieve this objective as well, and we will value only the portion that you want to sell.

How do You Get a Quote on Your Life Insurance Policy?

We make it a simple process.

  1. If you go to the life settlement calculator (also known as a viatical settlement calculator) on our homepage, you can get an estimate of the value of your life insurance policy. To use the calculator, you’ll need 3 simple pieces of information: your policy size (death benefit), your age, and your health status. It’s easy and the estimate is generated immediately.
  2. Once you’ve seen your estimated value, just fill out our simple application, we will more precisely value your policy as soon as we get details from your doctors and your insurance company, both only with your permission. You will not need to do anything at all while we are doing our work and everything we do is free and at no cost to you.

As soon as we have the information necessary to value your policy, we will call you with any offers that are made for your policy. You can then decide if the life settlement process is the right thing for you and your family. Remember, discussing this idea first with a financial professional, or your personal financial advisor, is always recommended.

Who Should You Allow to Buy Your Policy?

Life settlement buyers should make sure their life insurance provider or life insurance broker is licensed in their state (i.e. the state of the policy owner / policyholder). Check with the state’s Department of Insurance, Department of Financial Services, or equivalent state agency about whether the life settlement broker or provider are licensed. For example, in Florida, the regulator for viatical and life settlements is the Florida Department of Financial Services.

Your life settlement / viatical settlement provider and life settlement broker should be a member of the Life Insurance Settlement Association. LISA is the primary trade organization for those working in the life settlement industry in the US, and members must abide by a Code of Ethics and Standards of Professional Conduct.