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Jul 28

Selling Life Insurance

If you are really sure about needing to sell your life insurance, there are many options available for you.

Sales LeadsMany organizations are interested in purchasing policies recently, even if they are term life insurance. It is important to be sure of your decision and to inform everyone it involves before selling your insurance policy however, as it is an irreversible transaction. If you keep your life insurance but take out the cash before death to use it for whatever means, such as retirement plans, you would not enjoy the death benefit.

As such, selling your life insurance to a third party will give you more than what cash you would have gotten if you had waited to take out the cash value before death, all the while letting the third party receive the death benefit of your policy upon death. This will benefit both you and the third party that purchases your life insurance since the money you receive from them is higher than taking out cash value directly and meanwhile the money that the third party pays you is not more than the death benefit that they will be able to receive upon your death. Due to these facts, many organizations now take interest in purchasing your life insurance from you and so you have many options to consider before finding a deal that best suits you.

If you simply cancel a term policy, you will get nothing back.

If you cancel a whole life policy, you will only receive the cash value and the death benefit will be lost. Due to this fact, selling insurance is the more desirable course of action as it will be in your interest. Even selling term insurance can earn you money and selling whole life insurance will give you more money than the cash value. In the past, the option to sell your life insurance was not available and people would either get no money after cancellation or a lapse or only receive the cash value depending on the type of life insurance they acquired. These days however, many institutions would be interested in purchasing your life insurance from you and compensating you for it in return. This is definitely a more desirable option that with work in the interest of the policyholder.

Although some policyholders may not qualify for selling their life insurance, this is a rare occurrence. Due to the money that can be made by both the third party that purchases an insured’s life insurance as well as the person who sells their life insurance, a market has been created that did not exist before this potential was realized. Since cheaper term life insurance is not very desirable by third parties, it will be a better plan to purchase a more expensive one that you would be able to sell if the need to do so arises later on. If you do not need the coverage of the insurance policy any longer, it will be of more use to you if you have the ability to sell it to a third party company that would benefit you both.

Selling term life insurance can be a bit trickier than whole life insurance.

• If the term life insurance is not worth much, or if it is not convertible, you will be less likely to find a third party that is interested in purchasing it. In fact, it is almost impossible to sell such a policy. Due to the fact that convertible term policies can later on become whole life policies, they are desired by third parties. Regular term insurance is not convertible in nature and so not appealing for third parties. They would need expensive renewals since they are only temporary and for a short time, which is not very likely to cover the death age of the insured, and thus is not in the best interest of the third party with its growing expenses.
• What must be realized is that upon selling your life insurance, the third party that has purchased it will bear all future cost towards maintaining the premiums of the policy as well as receiving the death benefit. You must be prepared to give up the death benefit that would have gone to your family or business and instead enjoy the higher cash value that will be entitled to you.

Learning everything you can in regards to your life insurance and carefully weighing pros against cons will help you make a more informed decision about whether or not you should sell your life insurance.