Life Settlements Questions & Answers...

• What is a Life Settlement?
• What are reasons for choosing a Life Settlement?
• What is a secondary market?
• What types of policies are considered for a Life Settlement?  
• How can the money from a Life Settlement be spent?
• What is a cash surrender value?
• Who will pay the premium on my Life Insurance policy?
• Are the proceeds from a Life Settlement taxable?
• Are my records kept confidential?
• How am I protected?
• How much will I receive for my policy?
• Who are candidates for a Life Settlement?
• What are the steps in the application process?
• Why should I work with AIM Life Settlements?

Q: What is a Life Settlement?
A: A Life Settlement is a cash payment in exchange for an existing life insurance policy, with payment in excess of the Cash Surrender Value. The purchaser pays all future premiums. Life Settlements are also referred to as Viatical Life Settlements, Senior Life Settlements and Life Insurance Settlements.

For example, a Senior owns a $1,000,000 life insurance policy with a Cash Surrender Value (CSV) of $125,000. The CSV is the amount the insurance carrier will pay on a surrendered policy.

If eligible, the policy can be sold in exchange for a higher amount (i.e. a Life Settlement) on the open market. The open market is also referred to as the secondary life insurance market, where qualified funding institutions purchase policies in exchange for the beneficiary assignment. On average, a Life Settlement will pay 2 to 5 times more than the CSV.

To insure that a policy receives the highest bids possible, it is important that a Life Settlement application is exposed to all institutional funders. A policy without a CSV can also qualify for a Life Settlement. Many factors determine eligibility. See question, “Who are candidates for a Life Settlement?”
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Q: What are reasons for choosing a Life Settlement?
A:  Clients offer these reasons for choosing a Life Settlement...

• Policy premiums are too high
• The original need for the life insurance policy no longer exists
• The beneficiary of the policy is deceased
• The sale of the policy would allow the policyholder to achieve an improved standard of living
• The policyholder owns multiple policies and wishes to eliminate one
• The policyholder wishes to purchase a new life insurance policy that is more suited to their current financial / insurance needs
• The policyholder requires funds to pay for medical expenses
• A reduced estate value eliminates the need for a life insurance policy originally purchased for tax liability reasons
• Policyholder wishes to make a cash donation to charity
• A "key man" policy that is no longer necessary. (Used by companies to protect from the loss of key individuals)
• A charity wishes to liquidate a life insurance policy donation
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Q: What is a secondary market?
A:  A secondary market is where a product is bought and sold after it is initially offered in the primary market. Stocks, bonds, mortgages, real estate and life insurance policies are examples of products sold in secondary markets.
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Q: What types of policies are considered for a Life Settlement?  
A:  Almost every type of life insurance policy is considered for a Life Settlement. Among them are Term, Universal Life, Whole Life, Survivorship, Key-man. Policies can be owned by individuals or entities, such as trusts, corporations and charitable organizations.
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Q: How can the money from a Life Settlement be spent?
A: There are no restriction on how the proceeds from a Life Settlement are spent.
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Q: What is a Cash Surrender Value?
A: This is the amount of money that an insurance carrier will pay for a lapsed or canceled life insurance policy.

Q: Who will pay the premium on my Life Insurance policy?
A: After the Life Settlement is complete, the funder, who purchases your policy, pays all future premiums.
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Q: Are the proceeds from a Life Settlement taxable?
Though we highly recommend that you seek the assistance of a professional tax advisor, here is a general description of how the proceeds of a Life Settlement are subject to taxation:

Using this example:

·         Policy Face Value:    $1,000,000

·         Premiums paid:    $75,000

·         Cash Surrender Value:    $125,000

·         Life Settlement Amount:    $400,000

The policyholder has a $1,000,000 Life Insurance policy with a Cash Surrender Value of $125,000 and Total Premium Payments of $75,000. The Life Settlement Amount is $400,000. In this example, the first $75,000 (from Premiums Paid) would be nontaxable. The difference between the Premiums Paid and Cash Surrender Value would be treated as ordinary income. The difference between the Cash Surrender Value and the Life Settlement Amount would be treated as a capital gain.
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Q: Are my records kept confidential?
A: Yes, all records are stored in secure locations in accordance with state laws. The information and documentation are only provided to qualified and licensed purchasing companies to solicit offers for you policy
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Q: How am I protected ?
A: Your financial interests are protected in numerous ways...

·         You incur no out of pocket costs. The funding institution that purchases your policy pays all of the transaction fees.

·        A policy owner is not to obligated to sell at any time.

·         AIM Life Settlements represents the most qualified and professional companies in the Life Settlement industry. All are fully licensed and adhere to the highest standards of business integrity.

·         A third party escrow company is used for fund transfer.

·          Even after the settlement proceeds have been disbursed, your complete satisfaction is assured, as all transactions have a rescission period (generally 15 days), which has been determined by your state.
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Q: How much will I receive for my policy?
A: There are a number factors that determine the amount of a Life Settlement: Age, Premiums, Policyholder's health, Type of policy, Insurance company rating, Policy size, Competitive bidding. The average settlement amount is 2 to 5 the cash surrender value of the policy.

An exact amount cannot be determined until you have gone through the application process. This is a relatively simple process and is free of charge.
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Q: Who are candidates for a Life Settlement?
A: Here are some general guidelines that indicate if an individual is a potential candidate for a Life Settlement:  

• Males over age 65
• Females over age 70
• Individuals with a life expectancy of 12 years or less
• Anyone suffering from a terminal illness
• Minimum of $100,000 in life insurance coverage

Other circumstances may qualify. Call for a free, no-obligation pre-screening. 1-888-441-8881
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Q: What are the steps in the application process?
A: Our Life Settlement process is a snap. One application from you sets the wheels in motion for a process that will see your policy reviewed by every Intuitional Life Settlement Funders . Only one company will contact your doctors and insurance company. All records are kept in the strictest confidence.

Here are the basic steps of the Life Settlement process...

• There are no out of pocket costs paid by the seller. The purchaser of the policy pays all of the transaction fees.
• You submit an application and supporting documentation.
• Medical and insurance records are obtained by our team.
• The underwriting team conducts a review to determine eligibility.
• Negotiations are conducted with multiple funding sources to ensure the absolute highest offer.
• Upon acceptance of a settlement amount by the policyholder, a purchase and sale contract is completed.
• An third-party escrow account is established.
• Policy ownership and beneficiary rights are transferred and funds are release to policy owner.
• Standard processing time (application to fund transfer) takes between 7 and 10 weeks. A shorter processing time is possible.
• After the transaction is complete, the Policyholder still has approximately 15 days to rescind the deal (regulated by state).
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Q: Why should I work with AIM Life Settlements

A: AIM Life Settlements is designed to deliver the absolute highest cash profit offer for your Life Insurance policy. Our brokerage company presents and negotiates Life Settlement cases with every qualified and institutional Life Settlement Funder. In doing so, we create an  "open market" for your Life Insurance Policy. The more funding sources that bid on your policy, the greater the demand and the higher the settlement amount. The result is more interest in your policy...and a higher cash value to you.

AIM Life Settlements represents the most qualified and professional companies in the Life Settlement industry. All are fully licensed and adhere to the highest standards of business integrity.

We strive to deliver maximum value and superior service to our Policyholder and Financial Advisor clients. A policy owner is not obligated to sell at any time, and you will never be pressured.  After all, a Life Settlement is a very important decision. Even after the settlement proceeds have been disbursed, your complete satisfaction is assured, as all transactions have a rescission period (generally 15 days), which has been determined by your state.
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