When it comes to getting a life settlement, i.e., selling your insurance policy for cash, you need to be able to distinguish between two terms: life settlement brokers and life settlement providers. These are the two primary actors in this industry that assist people with their transactions, helping the process become easier and much smoother.
Who Are Life Settlement Brokers?
Life settlement brokers are agents who represent individuals wishing to sell their life insurance policy to a third party. In doing so, they help solicit offers and enable their clients to choose the best one based on the value being offered for the policy.
Life settlement brokers have a fiduciary duty to their clients (the policy owners). This means that they’re legally obligated to solely work in the best interests of their clients and help them get their policy’s worth, while selling it for cash. Life settlement brokers develop a special form of trust and confidence with their clients and exercise their expertise when acting on their behalf. They guide policy owners about the whole process, helping them realize the competitive value of their policy and facilitating throughout the transaction.
So, how do life settlement brokers go about this process? They collect the relevant documents and information from their clients, accumulating them in one place for further evaluation. These include medical records and information related to the life insurance policy. Once they have this information, they’ll help negotiate terms with licensed policy buyers interested in the existing policy, helping clients find the best deal in the competitive marketplace. Life settlement brokers will also help individuals determine whether they qualify for a life settlement or not and provide them with an estimate of what monetary compensation they can expect to get in exchange for their policy.
Is it possible to apply for a life settlement without a broker? Yes.
Is it recommended? Nope. Sure, you’ll have to pay a fee to your life settlement broker for the process, but this commission is small in comparison to the amount of complex work you ‘ll get guidance for.
Who Are Life Settlement Providers?
Life settlement providers represent the buyer. In some case, life settlement providers are the buyers themselves. Unlike brokers, life settlement providers are not legally obligated to act in their client’s sole interest apart from what falls under fair practice, i.e. they don’t have a fiduciary duty. They are, however, licensed to purchase life insurance policies from the brokers.
Life settlement providers are skilled in assessing and analyzing the investment quality of the policies they come across. They make bids for themselves or on behalf of their client based on the different aspects of the policy, ultimately trying to purchase the policy at the lowest possible price. In case of the former, they may further resell the policy purchased to another investor.
About Prosperity Life Settlements
Want to sell your life insurance policy for cash? Reach out to our life settlement brokerage firm for complete assistance in this matter. At Prosperity Life Settlements, we also offer a free life insurance settlement calculator.
Get in touch with our agents today to determine if you qualify for a life settlement.