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Ask the expert: What if the funder stops paying the premium?

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The question was: What happens to the settled policy if the funder stops making the premium payments (for any reason)?

The answer is: The answer is simple: The policy will either lapse for failure to make required premium payments, or the policy will use existing cash within the policy to make the premium payments.

The “funder’s” decision to stop making premium payments is of no concern to the seller provided he or she has already received their settlement proceeds.

This is important: it is always the responsibility of the owner to maintain the premium payments to keep the policy current until the ownership has been changed to the (buyer) new owner.

Rob Haynie
Managing Director
Life Insurance Settlements, Inc.
Fort Lauderdale, Florida
[email protected]


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