Agents & Advisors.
LIFE SETTLEMENTS FOR AGENTS
Get A Real Valuation In Minutes
YOU (AGENT):
1. In Force Illustration (best to age 100 or maturity)
2. Basic health information of the insured
POLICYMARKET:
Provides a real market valuation
With PolicyMarket you get a real estimate not a lost leader like some other firms.
We have a team of data analysts and complex software algorithms that allow us to get your client the most for their life insurance. This estimate is based on many factors and can go up or down during the process as we get more information about the insured.
HIGHEST
VALUE
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We know value - get it
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Our team works for you not the buyer
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Don't be undervalued by going direct
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Sophisticated software algorithms & data analysts
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Compensation structure aligned to get higher value
TOOLS & AUTOMATION
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Get Estimate in 60 seconds
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Close case faster
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Manage process
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Less work
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Instant updates on case status
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No back and forth
COMMISSION
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You make a commission for creating value for your client.
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20 % of Value added - over surrender value
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On average thats 3-4% of face value
How We Work.
Answer a few questions on behalf of your client, and if they qualify as a good candidate, POLICYMARKET will market the policy to licensed buyers and match the policy with the buyer that is willing to pay the highest value.
POLICYMARKET's online questionnaire is simple and intuitive - it should take you 1 minute to determine eligibility.
POLICYMARKET will quickly let you know if your client qualifies for a life settlement and then guide you through the process to get a risk-free offer.
Since we work with the largest purchasers of life insurance bidding on policies, your client will receive the best offer for their policy.
POLICYMARKET is free to use and free for the offer.
WHEN LIFE SETTLEMENT WORKS
Characteristics Of A Good Life Settlement Case:
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Face amounts of $100,000 and up
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Ages 75+ or 65+ with health changes since the policy was issued
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Current Assumption UL and GUL policies
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Last to Die, with one remaining insured living
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Convertible Term
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Premiums of less then 5-6% of Death Benefit to maturity
Our Goals Are Aligned With Your Client.
POLICYMARKET matches your client’s policy with licensed buyers faster and more effectively in order to deliver the highest value.
We have built our reputation around customer service and transparency. POLICYMARKET has set the gold standard in the industry of life settlements. We are on your team and an advocate of your client.
Our goal is to be your trusted partner making the life settlement process straightforward and worry free for your and your client.
POLICYMARKET keeps you updated in real time - no back and forth phone calls and emails looking for information.
RECOGNIZE OPPORTUNITY
Where Do Life Settlements Fit For Agents & Financial Advisors:
OVER 500,000 Seniors Let Their Existing Life Policies Lapse Annually... Yet Over 90% Never Knew They Had Other Options.
Many insured's have life policies that no longer meet their needs. Many do not realize there are options besides:
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Keeping the policy
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Lapsing the policy
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Settling for cash surrender value
There is fourth option...
4. Sell the policy for market value - Get a payout for the policy above cash surrender value and have no more premiums to pay.
Sell Your Life Insurance.
TM
Fund Your Life.
Agent Testimonial
“As an agent transacting a time Life Settlement for the first time I didn’t know what to expect. PolicyMarket made is super simple to understand what I needed to do, the platform was intuitive and kept me up to date throughout the process. I was able to communicate with my client and we got an offer over 15 times the cash surrender value. My client was ecstatic when she got her payout. It changed her life. I just submitted my second case with PolicyMarket.”
- Andrew
Financial Advisor & Life Insurance Agent
ANNUAL REVIEWS
An Opportunity To Discuss The Possibility Of An Exit Strategy
Here is where a Life Settlement makes sense:
As a financial advisor performing your annual reviews, see if your clients are in any of the following situations:
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Needs an influx of cash to supplement current retirement income and assets
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Life Policy is not longer needed or not affordable
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Fund their life - use money while living
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Would like to free up funds for a big purchase like a house or a boat
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The policyholder has outlived his or her beneficiaries
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The policyholder’s health status has changed and they need cash to help with medical costs
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There is a change in ownership of a company, retirement or a key executive has left. When a business has been sold or participants have exited, a policy to finance a keyman or buy-sell agreement, or a deferred compensation plan is no longer needed.
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Want to help children or grandchildren today
A Life Settlement may also provide advantages that a 1035 exchange cannot. A 1035 exchange is a provision in the tax code that allows for the direct transfer of accrued funds from one life insurance policy to another without creating a taxable event. However, a life settlement is preferred to the tax-free exchange of accumulated policy value because it may provide more funds, even after taxes.
Policyholders can also donate the funds from a life settlement to a charity. It serves as a tax write-off, and the donor can also see his or her donation in action during his lifetime.
Regardless of the reason, a life settlement is always a better option to a policy lapse or surrendering it back to the insurance company.
THE LIFE SETTLEMENT PROCESS
Three Types of Settlements
The Traditional option is to sell your full life insurance policy for a cash amount above the policy’s surrender value. You have no further premiums to pay or claims to the benefit. You get cash for the policy and all future premiums paid by the buyer.
The Retained Benefit option means you would no longer pay any premiums and retain a portion of your benefit. Beneficiaries will receive a guaranteed percentage when the policy ends, but you have no further obligations or premium payments to make.
The Hybrid option is a combination of two, where you would sell a portion of your life insurance policy. With this option, you receive a cash payment now and your beneficiary receives a guaranteed percentage of the benefit when the policy ends. With this option you will have no further premium payments or obligations.
Navigating The Life Settlement Process
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Easy to use for first time or experienced - The PolicyMarket platform guides you and automates the entire life settlement process.
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Our easy to use step by step task guide ensures nothing gets missed and keeps is simple to navigate your case on track for the quickest offer,
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Timeline showing you where you are in the process and
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Instant notifications - communicating updates to your case as they happen. Whether it is your first time for a life settlement transaction or you have done many, the PolicyMarket platform takes does the work for you.
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Tools and management - Simple and Quick policy estimator, document management, automated requests, Real time policy value updates.
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Step by step easy to follow tasks - highlights the tasks you need to complete for your client in order to get an offer. It’s only a few - we handle the heavy lifting.
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Automated / e-sign documents - Makes it fast and easy to get signatures from your client. No need to print, scan or fax - sign instantly. If you need to print and sign you can do that too.
CERTIFIED PUBLIC ACCOUNTANTS
Why Certified Public Accountants & Financial Advisors Need to Know About Life Settlements
It is important that CPAs and Advisors who serve affluent seniors and corporate clients should understand the potential applications for life settlements and the opportunities they present.
Life Settlements for High Net Worth Seniors
As a CPA, you should be able to assist your clients in understanding the value of all the assets in their portfolio, including the true value of a life insurance policy in the secondary market. Understanding life settlement can provide an additional option having a significant impact on your senior clients’ financial situations. A Life settlement can be the solution to financial planning objectives, freeing cash for emergencies or long term care, creating flexibility for other investments or charitable giving, in short anything a senior client might want.
Life Settlements for Financial Advisors
Life settlements provide the senior marketplace with the opportunity to tap previously unrealized value in their life insurance policies that are no longer needed or are no longer affordable. Life settlements are a another “Option” for financial advisors serving the senior community. This asset allows the owner to address current financial planning goals now that the policy can be liquidated for a fair market value and redistributed. It is key that you understand the opportunities a life settlement can provide your valued clients, whether the needs are retirement income, new life insurance policy, charitable giving, long-term care, or simply a vacation.
UNDERSTANDING LIFE SETTLEMENT TAXES
Taxation & Tax Reform Bill
The recently passed Tax Cuts and Jobs Act of 2017 (TCJA), has made life settlement taxation much easier to understand and calculate.
When you sell your policy, you are taxed in three tiers:
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Proceeds (the money you get for your life settlement) received up to the tax basis are free of income tax.
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Proceeds received that are greater than the tax basis up to the amount of the cash surrender value are taxed at ordinary income rates (this piece is not part of a typical life settlement).
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Proceeds received that are in excess of the cash value are taxed as capital gains.
So, the amount of taxable income is usually calculated by subtracting the tax basis (the total amount you’ve paid in premiums) from the amount you receive in the settlement.
Please remember that PolicyMarket does not provide tax advice. It is best to consult with your accountant or advisors on the tax implication of a life settlement. This material has been prepared for informational purposes only.
RECOGNIZE OPPORTUNITY
Commission & Compensation
The recently passed Tax Cuts and Jobs Act of 2017 (TCJA), has made life settlement taxation much easier to understand and calculate.
When you sell your policy, you are taxed in three tiers:
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Proceeds (the money you get for your life settlement) received up to the tax basis are free of income tax.
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Proceeds received that are greater than the tax basis up to the amount of the cash surrender value are taxed at ordinary income rates (this piece is not part of a typical life settlement).
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Proceeds received that are in excess of the cash value are taxed as capital gains.
So, the amount of taxable income is usually calculated by subtracting the tax basis (the total amount you’ve paid in premiums) from the amount you receive in the settlement.
Please remember that PolicyMarket does not provide tax advice. It is best to consult with your accountant or advisors on the tax implication of a life settlement. This material has been prepared for informational purposes only.
WE'VE GOT YOU COVERED
Errors & Omissions
Most E&O policies held by agents omit life settlement transactions. As a result, PolicyMarket’s’ E&O coverage was designed to cover agents for life settlements closed with PolicyMarket. This covers agents up to $1 million of liability for no charge. This is a very expensive benefit provided by PolicyMarket that other intermediaries do not offer.
WHAT AGENTS NEED TO KNOW
Agent Frequently Asked Questions
What is a life settlement?
A Life Settlement is a sale of a life insurance policy where the insured is 65 years of age or older and does not have a terminal or chronic illness. In a life settlement transaction, the policy owner always receives more for the policy than the issuing insurance company will pay for the surrender of the policy.
What types of life insurance policies can be sold?
Policies must have insureds that are at least 65 years old with change in health or 75+ years and need to have a Face Amount of at least $100,000. Types of policies eligible include: universal life, term life (if convertible), whole life, variable life, and variable or universal survivorship/second to die.
Are there any medical exams or application costs?
No. The application and appraisal process with PolicyMarket is free. No medical exam is required, the insured will only have to consent to having their medical records reviewed.
What determines the price offered for a policy?
The amount to be paid to the owner of the policy will depend upon a number of factors, including the medical condition of the insured, the amount of premium payments to keep the policy in force and the cash surrender value of the policy. Learn more about how a policy is valued here.
What should I look for in a broker?
Compliance. A broker who has a culture following procedures that meet the highest standards – especially important now that the most populous states regulate life settlement. PolicyMarket is considered the “gold standard” in life settlements.
Agreements between producers and providers, and between the life settlement broker and the seller, detailing all terms, conditions and compensation.
Documentation approved by the Department of Insurance in the policy owner’s state.
Transparency & Disclosure dealing objectively with the pros and cons of life settlements such as tax impact, benefit eligibility and future insurability. Transparency is the critical cornerstone in longevity and the relationships we build with our clients.
Privacy Highest standards protecting Personal Identifiable information. Security is critical for keeping information confidential.
Should I “shop” my policy to more than one broker?
“Shopping around” many times works against the policy owner and results in a lower offer. When a buyer (provider) receives an inquiry from more than one broker it raises questions as to who really controls the case and who they should be working with. Some providers will just make the same offer to all comers or even decline all offers, afraid that the case will not close. Either way, the ability to negotiate a higher “final” price for the policy is reduced for everyone.
What is the process of a life settlement transaction?
PolicyMarket keeps you updated in real time - no back and forth phone calls and emails.
First: If a policy qualifies (link to get estimate link) An application is completed and submitted to PolicyMarket. You will upload at in-force illustration (to maturity if possible) to provide insight into the financials of the policy. If you can not provide an in-force illustration of the policy from the issuing insurer we can get one on your behalf.
Next: PolicyMarket obtains copies of the insured’s existing medical records from the insured’s physicians that were listed in the application. No medical exam is necessary. We package this information and submit it to multiple life settlement providers (buyers) to establish a competitive marketplace and obtain the highest possible offer.
An offer is made: If the insured accepts the offer the life settlement transaction moves to closing, much like a house. The buyer will deposit the settlement amount with an escrow agent or trustee. The money will be sent within three business days of the date that insurance company confirms to the provider that the transfer of policy ownership has been completed.
How long does it take to complete a life settlement transaction from start to finish?
We complete most transactions in 45 days, until submitting change forms to the carrier. The time it takes the carrier to change the policy ownership can vary from days to a month. We are using new advanced underwriting techniques using electronic medical records, prescription histories and insurance claims history to decrease underwriting time. Many times the buyers need to review medical records carefully and sometimes obtaining these records may take some time to accomplish and can slow down the transaction process.
After the policy is sold, how will the provider know the insured has passed away?
Life settlement providers use a number of techniques to determine the insured’s status. For example, most use the Social Security Administration’s public database, which “frees up” a social security number when someone passes away. They may periodically call a person designated by the insured to inquire as to the insured’s health status. Most states prohibit the buyer from contacting the designated contact more that four times per year.
What if the insured changes their mind after selling?
Life settlements are regulated by the state and have a rescission period after the insured receives the payout from the provider. The guidelines for any rescission period is explained in detail in the Life Settlement Purchase and Sale Agreement, which can vary on a state-to-state basis.
What if the insured dies shortly after selling the policy?
If the insured dies during any rescission period (which is explained in detail in the Life Settlement Purchase and Sale Agreement), the settlement contract will automatically cancel. The provider will pay the owner of the policy or beneficiaries designated by the owner in the life settlement contract any proceeds it receives from the policy, minus any money it already paid for the purchase of the policy and any premiums it paid to the insurance company to keep the policy current. The insurance company or the provider should refund any unearned premiums paid.
Are the proceeds from the life settlement taxable?
The recently passed Tax Cuts and Jobs Act of 2017 (TCJA), has made life settlement taxation much easier to understand and calculate. The proceeds from a life settlement are generally tax free up to the basis or amount of the premiums paid into the policy. The difference between premiums paid and the cash surrender value is generally taxed as ordinary income. Amounts received in excess of the cash surrender value are generally taxed as a capital gain. See more on taxation here. (link to taxation above) We strongly encourage sellers to consult their own tax and financial advisor before completing a transaction so that they can determine the tax impact from the sale.
What is the difference between a life settlement broker and a provider?
Although both a broker and a provider are instrumental participants in the sale of your policy, there are important differences between the two. The most important is the broker works for the policy owner. The broker’s job is to “shop” the owner’s policy to the entire market of potential buyers and create a competitive environment that ensures that the owner receives the best offer possible. A provider works on behalf of the institutional investors that they represent. Their objective is to purchase your policy at the lowest possible value and maximize the return on investment for their investors.
