When it comes to financing senior care, many people are unaware of Life Settlements even though they have been around for many years and represent an easy way to help cover senior care related expenses.
What is a Life Settlement?
A Life Settlement refers to the sale of an in-force life insurance policy by the policy owner of a third party. Therefore, the seller no longer pays the premiums for the insurance policy but instead it is the new owner who is obligated to make the payments and becomes the beneficiary.
Who benefits from a Life Settlement?
Seniors aged 65+ who have a universal, whole life, or convertible term life insurance policy over $50,000, regardless of income, qualify for this financial tool. Life Settlement amounts increase with age though so it might be helpful to bear this in mind when considering using this method.
The most obvious benefit of a Life Settlement is that the seller of the life insurance policy instantly receives cash and saves money by eliminating monthly payments for the life insurance policy. This additional income can then be used to pay for medical bills and other expenses such as senior housing and elder care.