Can I Sell My Life Insurance Policy? 5 Things You Should Know Before You Decide

Can I Sell My Life Insurance Policy? 5 Things You Should Know Before You Decide

Description: Find out if you can sell your life insurance policy, and more importantly, if you should.

Slide One: Many life insurance policies can be sold for a portion of their cash value. This can help you get a head start on your retirement, pay off some bills, or finance a big purchase. But before you decide, there are some things you should know. 

Slide Two: Not everyone is eligible

Many people who ask, “Can I sell my life insurance policy?” are not aware of the requirements. In order to be eligible, you probably need to be at least 65 and have a policy worth $200,000 or more.

Slide Three: There are different types of policies

The different types of life insurance policies are “term life” and “whole life”. A whole life policy is a permanent policy without a set term, and a term life has an expiration date. Both can be sold, but a term life needs to be convertible into whole life.

Slide Four: All settlements are different

Basically, when you sell your life insurance policy, you are reaching a settlement agreement with the company for a portion of its equity. This amount is usually a little less than the death benefit, but more than its cash-out value.

Slide Five: Selling your policy gets you off the hook for payments

When you sell your policy, the buyer picks up the remaining premiums. One less bill to pay means less debt and more money in your pocket. 

Slide Six: You have other choices

If you need a lump sum of cash but you can’t find a buyer for your policy, you can sometimes cash it in with the accelerated death benefit clause. You probably won’t get as much as you would from a buyer, but it’s another option in case you need it.

Final Slide: Selling your life insurance policy can make a big difference in your financial future. Many people find it helpful in buying a home for retirement or paying off large sums of debt to free up their income.

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