What’s Reverse Life Insurance?
selling my life insurance While it’s common knowledge that life insurance policies are designed to provide monetary benefits to beneficiaries after the policyholder’s death, these policies also have other versatile uses. For example, life insurance policies can be leveraged to cover expenses like medical bills or debt while the policyholder is alive.
Moreover, selling your life insurance policy is a lesser-known but increasingly popular option. Reverse life insurance, or life settlements, lets policyholders transform their policy into cash on hand. This option can be particularly beneficial for individuals seeking immediate financial relief.
What is Reverse Life Insurance? How Does it Work?
viatical settlement There’s a common misconception that ‘Reverse Life Insurance’ and ‘Life Settlements’ are the same, but they differ. Both involve converting death benefits into immediate cash value, but they are not identical.
As a broad term, Reverse Life Insurance includes various methods of converting a policy into cash. In Life Settlements, the policyholder sells their policy for more than the surrender value but less than the full death benefit.
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