Generally, anyone over age 70 who has $100,000 or more in life insurance coverage may qualify for a Life Settlement regardless of health condition. Other factors considered in the negotiations are the policys cash surrender values and the cost of premiums. A basic principle to remember is that the older the age of the insured and/or the more health complications exist, the higher the settlement. However, each individuals situation is different from case to case.
The fundamentals of the Life Settlement transaction have technically been around since 1989 in the form of viatical settlements. Individuals at any age can qualify for a viatical settlement if they have a chronic or terminal illness such as cancer or HIV. Viatical Settlements have always been contingent upon the health of the insured, whereas Life Settlements are contingent mainly upon the age of the insured. In most states a terminally ill senior applicant will need to use a licensed viatical broker and/or funder in order to abide by state rules and regulations and to retain the tax-exempt status of the settlement.
According to industry reports, Life Settlement proceeds are tax-free up to the cost basis (premiums paid since policy inception). They are taxed as ordinary income from basis to cash surrender value and proceeds above the cash surrender value are taxed as capital gains.
Once the Life Settlement change of ownership has been recorded with the insurance company and the policyholder has received their money, the Life Settlement funding source will continue to pay premiums throughout the life of the insured. All types of life insurance qualify including group, term, whole-life, universal, survivorship and key-man policies.
Settlement Loan
The legal system in America is currently stretched with more personal injury lawsuits than it can comfortably process. Many insurance carriers are taking a stronger stand in the settlement process which increases the length of time to resolution in many cases. The victims of personal injury are being hurt the most by this reality because they are often out of work and have difficult time making ends meet until they receive a settlement or judgment in their case.
Fortunately, Global Financial Credit, LLC (
http://www.glofin.com offers low cost settlement loans against pending legal claims. A Settlement Loan is not ..
ABOUT THE AUTHOR
Grant Shellhammer is an affliate Life Settlement Broker with Life Settlement Pro. He works with senior citizens and financial professionals nationwide to provide life settlements.
Contact details:
grant@lifesettlementpro.com
1.888.973.8377
http://www.lifesettlementpro.com
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If you sell your investment property, you will need to pay capital gains ..
