Sample Case Study: Cash Settlement
Senior Settlement
Case Study #1
"Cash Settlement"
Female age 83, with no significant health history. Client's son owned and maintained a life insurance policy on her life for estate planning purposes.
|
Death Benefit |
|
$1,000,000 |
|
Premium |
|
$40,000 annually |
|
Surrender Value |
|
$30,000 |
|
Policy Date |
|
4 years old |
|
Death Benefit |
|
$1,000,000 (new policy issued since old policy was sold) |
|
Premium |
|
$39,000 annually ($1,000/year savings) |
|
Surrender Value |
|
$0 |
|
Policy Date |
|
2001 |
|
Cash Settlement |
|
$200,000 (check payable to the policy owner) |
$200,000 settlement proceeds were disbursed to the son who owned the policy. He chose not to use the proceeds to reduce or eliminate future premiums on the new policy. Those funds were used for other business opportunities.
Since no two transactions are ever identical, individual results may vary.
The purchase price of Senior Settlements will vary depending on the institutional buyer, health history of the client and other variables that may be present at the time of sale.
Replacement insurance premiums will vary depending on the insurance company selected and health history of the client.
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