What Is A Life Settlement?

A life settlement, sometimes referred to as a viatical settlement, is the sale by the owner of a life insurance policy to a third party. Why would someone sell a life insurance policy? This can be beneficial if the policy is sold for more than the cash surrender value.

The seller of the policy can elect to receive:

  • A cash payment at the time of sale;
  • A portion of the death benefit proceeds upon the death of the insured for the insured's beneficiaries (a retained death benefit); or
  • A combination of an upfront cash payment and a retained death benefit

The buyer of the policy assumes all future premium payments. The buyer receives either:

  • The full death benefit after the passing of the insured; or
  • A portion of the death benefit proceeds if it is a retained death benefit transaction. The remainder of the death benefit proceeds would go to the seller's designated beneficiaries.

Life Settlement Transactions: How You Can Benefit From Our Services

The typical life settlement transaction involves a broker, the policy seller and a life settlement provider, which may be purchasing for itself or for a third-party investor or financial institution. Given all the parties with differing interests, policy sellers are best served when they are represented by an attorney to help them in the transaction.

Rather than charging a high brokerage fee, Adler Wellikoff, can offer the service at a much lower cost. Our firm handles a broad range of life settlement and viatical settlement matters for individuals, providers, brokers, investors, lenders, estate attorneys and financial institutions. Our attorneys at Adler Wellikoff have several years of experience working with one of the largest publicly traded life settlement providers in the industry and have worked with policy sellers, providers, brokers, investors, servicers, securities intermediaries, custodians and financial institutions on all aspects of licensing, regulating, purchasing, selling, servicing, collecting and litigating life settlement matters.

Our life settlement legal services include:

  • Negotiating life settlement and viatical settlement purchase and sale transactions
  • Drafting life settlement and tertiary policy and portfolio purchase and sale documentation
  • Licensing matters
  • Creating life settlement provider programs
  • State regulatory matters and investigations
  • Negotiating and drafting portfolio-wide loan and security agreements for providers
  • Negotiating and drafting securities intermediary and custodian documents
  • Negotiating and drafting third-party life insurance policy servicing agreements
  • Death benefit collection matters and disputes

Read more about the attorneys at our firm.

Have Questions About Life Settlement Transactions? We Have Answers.

Contact the lawyers at Adler Wellikoff in Boca Raton, Florida, at 561-923-8600 or send us an email.