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Now is the time to take another look at term policies and secondary guarantee policies.
Term Policies
We have often stressed the importance of timeliness when it comes to life settlements involving term policies because it's crucial that the life settlement occurs while the policy is convertible.
Non-convertible term policies can rarely be sold in a life settlement due to their increasing and costly premiums.
A new trend makes it even more important to consider term conversion life settlements sooner rather than later.
Insurers are increasingly limiting which of their permanent policies that their term policies can be converted to.
Those converted policies are often more expensive than previously available ones, making them less valuable in a life settlement.
So, if you have clients with term policies they may no longer need or can afford, the time to act is now.
Guaranteed Premium Universal Life Policies
Guaranteed universal life policies are uniquely valuable because their performance may not be negatively impacted by low interest rates.
They give would-be life settlement investors a level of assurance that interest-sensitive policies do not.
Consequently, even healthy insureds with these policies can be candidates for a life settlement.
As a result, guaranteed policies — both individual and survivorship — are hot.
If you have clients, even healthy ones, with these policies that are considering a lapse or surrender, now is the time to give a life settlement a look.
Don't let the life settlement opportunities presented by term conversions and guaranteed universal life slip by.
Strike while the iron is hot.
Remember, "it can't hurt to try — it can only hurt not to!"
Robin S. Weinberger, CLU, ChFC, CLTC, is the director of national accounts for Life Insurance Settlements Inc. She has been a general agent and director of national accounts for Connecticut Mutual and vice president of marketing for Sun Life of Canada.
Peter N. Katz, JD, CLU, ChFC, RICP, is a life settlement broker and co-director of national accounts with Life Insurance Settlements. He is also a consultant specializing in life insurance advanced sales illustrations, and he has served as an advanced markets attorney and in product development.
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