Why Seniors Sell

Why Seniors Sell

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Life insurance is an important investment in many seniors’ portfolios and business strategies. 

There are 38 million insurance policies owned by American seniors over the age of 65, which have a collective face value of more than $3 trillion.

An astounding $100 billion+ in face value of life insurance is lapsed or voluntarily surrendered each year by seniors over 65.

There are numerous reasons to consider selling a life policy:

  • The premiums are no longer affordable
  • The need to replace lost income in case of death of the insured no longer exists
  • The need for funds to pay estate taxes no longer applies
  • There is a need for resources to pay for health expenses and long term care
  • Funds are wanted to improve a retirement lifestyle
  • There is no longer a business need
  • There is no longer a need for Buy/Sell agreement funding
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  • A 2010 survey prepared for the Insurance Studies Institute indicated that 90 percent of seniors who have let a policy lapse would have considered selling it if they had known a life settlement was an option.
  • A 2013 study prepared for The Lifeline Program (conducted by ICR) indicated that 55 percent of seniors allowed their life insurance policies to lapse, viewing it as a liability instead of an asset.

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