It feels incredibly daunting and overwhelming to make big life decisions. The choice to pursue a viatical settlement is yet another one of these decisions. Though it may seem out of touch to plan for this part of your life, it’s actually a wise financial alternative to consider for many reasons. If you have tons of questions, and you’re wondering when is the right time to pursue a viatical settlement, then keep reading to get some of your questions answered.
What is a viatical settlement?
A viatical settlement is a specific arrangement between a third party and a life insurance policyholder. With this arrangement, the life insurance policy is essentially sold to the third-party investor. When searching for a reputable third party to sell to, check out American Life Fund. Their company buys your life insurance policy from you. During the time you’re alive, they continue to the monthly payments to your insurance company so that when you or your loved one passes, the third party receives the entire death benefit. In return for selling to them, you receive a lump sum cash payout.
Though it may seem like a grim discussion, it takes a terminal illness to qualify for this settlement. Remember that you’re not alone if you’re struggling to find ways to manage daily life while battling an illness like cancer. Reports show that cancer is the leading cause of death worldwide. With this in mind, it makes sense that you’re trying to find ways to manage your finances before you or your loved one’s health depletes.
Again, to qualify for this specific type of settlement where you completely sell your life insurance policy, you must have a terminal illness like a late-stage cancer diagnosis. There are other medical conditions that qualify you for a viatical settlement, and as long as you or your loved one has a shorter life expectancy, then it’s likely you’re eligible. Generally speaking, you must provide medical records to your third-party investor to ensure your case.
When should you pursue this option?
Now that the general information and qualifications on viatical settlements are clear, you might be questioning when you should pursue selling your life insurance policy. As a rule of thumb, most choose to sell their policies when their life expectancy is less than two years. Once you or your loved one is at this point, then you should reach out to viatical settlement financial services to work on your options. However, it’s also worth noting that each state within the United States has specific regulations about viatical settlements too. Depending on the state, you may have to own the insurance policy for a minimum number of years. The investor you speak to will let you know if you qualify. From there, you’re able to move forward with the agreement.
How will it help you?
When the third party of your choice buys out your life insurance policy, you receive a lump sum of cash. This money is incredibly useful for when you or your loved one passes. Though it’s hard to think of things this way, it’s essential to keep in mind that this is the terminally ill patient’s choice to make. The immediate cash payout allows the terminally ill person to have peace of mind because they’re able to provide their family with the finances they may need after they’re gone. This money may be the saving grace that helps your family manage funeral services, medical bills, medications that are commonly costly for cancer patients, and any other expenses that might financially cripple your family. In turn, by opting to pursue a viatical settlement, you ensure that finances will be one less worry for the ones you love.