Did you know that U.S. seniors are losing over $200 billion in life insurance every year? That’s more than double the size of the global ice cream market! Life insurance can be a senior’s biggest asset, but often they get little in return.
As financial advisors often say,
“seniors are asset rich but cash poor.”
In the midst of a retirement crisis, rising senior poverty, and the vanishing of generational wealth in America, what can be done to help seniors recoup their losses?
The problem is systemic. Life insurance companies lure young families with high-perceived offers and nominal premiums, but as people age, the narrative never changes. Instead, the emphasis is on buying more life insurance at even higher prices. Seniors feel obligated to keep paying, despite the odds. Nearly 90% of policies never pay a death benefit, which is how carriers continue to profit at seniors’ expense.
But there is an option for some seniors to recoup their losses. In 1911, the Supreme Court ruled that life insurance is a person’s private property, not the insurance carrier’s. Life insurance is an asset that can be sold, similar to real estate. Today, this law has developed into a fully regulated and safe marketplace for millions of American senior policyholders looking for a better financial solution.
Life settlements (sometimes referred to as viatical settlements, though they are different) may be the only shot seniors have left. In 2021, consumers received $660 million more than if their policies had lapsed or been surrendered, according to the Life Insurance Settlement Association.
So, should seniors consider selling their life insurance policies?
The answer is yes, even if they don’t need the money. It’s important to consider every option that could help reach their desired future outcome.
But not every life settlement company is created equal. Consumers should ask themselves one question when considering a life settlement: Should I talk with a broker or a buyer?
Although direct buyers can settle transactions faster, they are not fiduciaries. A life settlement broker is a licensed fiduciary who works in the best interest of the client. Brokers save time by completing one application that is presented to multiple buyers to achieve the highest offers. Brokers ensure clients are treated fairly and only get paid a commission if a seller accepts an offer.
At Bridge, we are a licensed life settlement and viatical settlement brokerage with a mission to increase wealth for American seniors. As fiduciaries, our goal is to save you time by streamlining your application across top buyers and negotiating the highest settlement guaranteed.