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Selling Your Life Insurance Policy

People lapse or surrender their life insurance policies almost 9 times out of 10.  Policies are dropped because they become too costly, or there are other pressing financial needs, or because the policy is no longer needed.

Just like a car or a home, selling your policy starts with getting it appraised for its resale value.  The following is an overview of the life settlement process.

Can I Sell My Life Insurance Policy?

Selling a life insurance policy is the property right of every American life insurance policyowner.  The US Supreme Court, in 1911, held that “it is desirable to give to life policies the ordinary characteristics of property,” and restricting a policyowner’s property rights to sell their policy was illegal and would “diminish appreciably the value of the contract in the owner’s hands.” Grisby v. Russell, 222 US 149 (1911).

The proceeds from the sale of a policy is a substantially more valuable option than the lapse or surrender of a life insurance policy.

4 times greater estimatesPeople who sell their policies receive cash payments that are, on average, four or more times greater than the amount that the insurance company would pay, according to government and university studies.

The Process for Selling a Life Insurance Policy

Do I Qualify for a Life Settlement?

The following are some important pre-qualification criteria that are needed to begin the evaluation process:

The Life Insurance Policy

Most every type and size of insurance policy qualifies for a life settlement, as follows:

  • Policy Size: $100,000+ death benefit
  • Policy Type: Universal Life, Indexed Universal Life, Whole Life, and Convertible Term Insurance Policies

Term Policies, if convertible.

  • Transferrable: Must be transferrable (no restrictions on the sale of the policy, by virtue of any pre-existing agreement or court order).

The Insureds


The insured’s age and health are part of the evaluation of a life insurance policy’s value.  A policy where the insured is in their early 70’s with very few health conditions would not have a market value.  The pre-qualification criteria for a senior insured’s age and heath include:


  • Insured’s Age: 65+
  • Insured’s Health: If under 75, one or two changes in health since the policy was first issued.
    If over 75, at least one serious condition.

Terminally Ill or Chronically Ill

Individuals with life threatening illnesses or conditions, or who may be terminally ill or chronically ill can qualify for a life settlement at any age.

As always, the best way to determine if you qualify for a life settlement is to have your policy appraised by LightHouse Life.

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What Do I Need to Get My Policy Appraised?

Policyowners participate in a brief, confidential telephone interview to provide the following information:

Policy Information

  • Policy Size and Type
  • Insurance Company name
  • Obtaining In-Force Projection of Future Premiums from Insurance Company

The Insured’s Health Information

  • Self-Report about Health and Wellness
  • Authorization to Review Health and Prescription Records

What are the Next Steps in Selling My Policy?

  1. Telephone Interview
    Policyowners participate in a brief, confidential telephone interview with LightHouse Life to collect information about the policy and the individual insured under the policy.
  2. Policy Appraisal/Offer
    LightHouse Life reviews the collected information and sends the policyowner an appraisal of the policy and, if qualified, an offer to purchase the policy.
  3. Review/Acceptance of Offer
    The policyowner reviews the offer letter and can decline or accept it.
  4. The Life Settlement Contract and Requirements
    LightHouse Life sends the policyowner a contract, as well as a request for all documents required to complete the transaction.  The company validates information about the policy.
  5. Escrow Funding Settlement Proceeds and the Release of Proceeds
    Once the life settlement contract is executed by all parties, LightHouse Life places the full purchase price into an escrow account at a national bank.  The funds are released to the seller of the policy once the insurance company completes the change of owner and beneficiary on the policy and notifies LightHouse Life and/or the bank.

When Will I Receive My Life Settlement?

LightHouse Life makes the transaction easy and fast.  Many times, the policyowner can receive their cash payments within 60-90 days from first contacting LightHouse Life.

LightHouse Life will:

  • Contact policyowners within hours following submission of their contact and pre-qualifying information.
  • If qualified, provide market value appraisals and, if qualified, offers to purchase the policy within seven days of collecting the necessary policy and insured’s health information.
  • Fully fund the escrow account with the cash payment for the sale of the life insurance policy following receipt of complete documents and execution of the contract.
  • Once the life insurance company completes the change of owner and beneficiary on the policy, the funds are released from the escrow account to the policyowner.

Get an Estimate on Your Life Settlement Today

Just like any other property, a life insurance policy should be appraised for its market value. LightHouse Life offers a fast and free process to get your estimate.

We have a mission to provide value to life insurance policyowners through life settlements. We believe in setting the highest standards of professionalism and transparency in the life settlement market.  We are committed to making American families aware that life settlements can provide life-changing resources to seniors and their families.

Contact LightHouse Life now for a free appraisal!