Fundemental Life Settlement

1. Client situation:

• 75 year-old male


• $2,000,000 Face Value Universal Life Policy purchased 5 years ago


• Cash Surrender Value of $50,000


• Upcoming Annual Premium $60,000


• Change in financial situation: Estate tax changes reduced need for coverage and as a result the client (insured) does not want to pay escalating premium any longer

The Settlement Process:

• Client case file compiled: HIPPA, medicals/APS, In-force Illustration, Life Expectancy reports, Application, which is sent to multiple Funder's for evaluation and pricing offers


• Received 4 initial offers ranging from $360,000 to $380,000


• Subsequent negotiations result in a final high offer of $460,000


• Client reviews highest offer and decides to accept the offer


• Transfer of ownership contracts are then processed and executed


• Coverage is verified at the Life Insurance carrier


• Escrow


• Policy ownership is transferred and recorded at the Life Insurance carrier


• Settlement funds are wired to the policy seller (net of disclosed compensation fees)


• Client uses proceeds fro retirement funding, smaller Insurance Policy


• Upon the expiration of statutory contract rescission period (normally 3 - 15 days) compensation fees are wired to the agent/broker