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Sample Case Study: Eliminate Premium Payments
Senior Settlement
Case Study #2
"Eliminate Premium Payments"
Male age 73, with reasonable health history. Client maintained a life insurance policy for estate planning purposes. Recent changes in his personal finances prompted him to investigate strategies that would reduce his annual premium outlay.
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Death Benefit |
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$1,000,000 |
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Premium |
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$30,000 annually |
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Surrender Value |
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$55,000 |
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Policy Date |
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5 years old |
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Death Benefit |
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$1,000,000 (new policy issued since old policy was sold) |
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Premium |
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$0 annually (reduced to ZERO since proceeds from sale of old policy were applied toward the new policy) |
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Surrender Value |
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$128,000 (approximate CSV in first policy year) |
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Policy Date |
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2001 |
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Cash Settlement |
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$200,000 (applied to new replacement policy) |
The client was able to eliminate policy premiums by applying settlement proceeds toward the new policy.
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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