Life Cycle Financial Planners, LLC

Category: innovation

Get Paid For Selling Your Unwanted Life Insurance Policy – 10 FAQs.

More and more life insurance owners are taking advantage of life settlements by selling unwanted or un-needed life insurance policies to 3rd party investors. There are still too many owners of life insurance who shy away from or do not know about this option. The industry is regulated and very beneficial to policy owners over age 70. There are exceptions to age 70 and experienced life insurance professionals can help people navigate their way through. The bottom line is that policy owners can let policies lapse, surrender the policy for its internal cash value or sell it for its maximum market value. Each case is unique. What is the market value of 2015 BMWs, 4-door sedans? Without an appraisal, it is impossible to know the price for each one. There is no set price. The exact same rules apply to inforce life insurance policies.

What is a life insurance settlement? When an un-needed or unwanted life insurance policy is sold to a third party investor, that is known as a life settlement. In exchange for selling the policy, the owner receives a lump-sum payment. Or, some people choose different options allowing them to “partner” with the investor to keep a portion of the death benefit, without ever paying further premiums.

Who should sell the policy for you? An experienced life insurance professional, especially experience in the life settlement market. By putting buyers in a competitive situation, offers will increase. The U.S. market is robust and you want an agent with knowledge and access to all current buyers. Should you sell your policy? It pays to work with a professional working in your best interest. Before making a decision, I advise my clients to speak with their spouse, other advisors and their heirs. This information about a life settlement transaction may help.

What is the ideal age to sell a life insurance policy? Typically, buyers of life insurance policies want people who are at least 70 but there are exceptions. Some people under 70 have significant health history and they may qualify. The buyers of policies are more interested in people with shorter life expectancies and a significant health history. Of course, those people with significant health history often want to keep their policies.

Can term life insurance policies be sold for a lump-sum payment?
Yes, but not all term life insurance policies are eligible. It depends on the specifics of each policy, including conversion deadlines, which can be determined in a brief phone call. Most buyers are not interested in policies with less than $1,000,000 of face value.

Can a term insurance policy eligible?
Most life settlement buyers only want term policies that can be converted to permanent insurance.

When does the conversion privilege on my term policy expire?
The conversion deadline varies in each policy, even policies issued by the same company will have different conversion deadlines. Some limit the conversion period to a number of years while others may impose a maximum conversion age, often around age 65.

When should I begin to convert the policy if a conversion is necessary?
Selling a policy involves getting recent medical records, in-force illustrations, a life expectancy analysis, an offer and closing documents. Because the entire process can take 3 to 4 months, it’s best to convert no later than 4 to 6 months prior to the expiration of the conversion privilege. Each time you review your existing life insurance portfolio, it is wise to review conversion options.

What are the alternatives to selling an unwanted policy? If your life insurance policy has market value to an investor, it may also have value to your heirs. Depending on the circumstances, there are methods to help heirs retain portions of a policy, without paying further premiums. These alternatives are often overlooked, especially in rushed situations.

Can I split my policy and sell part of it?
It depends on the policy and the company that issued it. Some insurance companies do not permit a policy to be split.

What happens to the cash value in my policy if I sell it? When there is cash value in a policy going to the settlement market, it is a good idea to discuss the many options to maximize its value before the sale occurs. If there is an outstanding loan, that too should be addressed.

How is this different than a viatical settlement? Viatical settlements are exclusively for people who are terminally ill.

What are the income tax ramifications ? There are income tax consideration for some people but each situation is unique. Of course, income taxes will not exceed the lump-sum you receive, if taxes are due.

To help people with the possible sale of your policy, we offer a complimentary consultation by phone. Please call us or fill out the contact form on this page and we will contact you shortly. You can call us directly at 561-771-4647.

PERHAPS WOULD YOU LIKE MORE INFORMATION ABOUT GUARANTEED, LIFETIME INCOME FOR RETIREMENT?

Income annuities create guaranteed, lifetime income without any risk to principal. Everything is guaranteed. To learn more about these special annuities, click this.

September 8, 2020
New Alternative Creates Customized Payouts of Life Insurance Proceeds to Protect Beneficiaries.

For the past 200 years, life insurance companies have only offered a lump-sum payout of policy proceeds to beneficiaries. For many, this is not ideal considering these income tax proceeds are squandered in less than 5 years. Ask any life insurance buyer if they intend for the proceeds to be spent in less than 5 years.
Life insurance buyers want choices. In fact, a high percentage of life insurance owners do not want a lump-sum payout. Instead, they want a policy that gives them the option to create a customized and guaranteed income stream for their beneficiaries that cannot be mismanaged. The Installment Option instructs the insurance company to make guaranteed, pre-determined income payments over time. These payments are selected when the policy is issued by the policy owner. The best life insurance policies today give policy owners flexibility and options; the more, the better.

The Installment Payout Option allows policy owners to create a customized schedule to fit their family needs and guarantee a protected income stream for their beneficiaries, up to 10, 20 or even 30 years.
 Premiums payments – up to 50% less for guaranteed results or the
total benefit is increased as much as 50% for the same premium.
 The annual payments are pre-determined and guaranteed,
regardless of economic conditions or other variables.
 Ability to customize the death benefit payments to meet individual
planning objectives.

Proceeds are paid according to a pre-determined schedule, selected by the policy owner at the time of purchase. In the past, a lump-sum payment was the only option available. The Installment Option eases concerns about lump-sum payments being mismanaged.

Protect Proceeds For Beneficiaries

What is the Installment Life Payout Option?
Rather than your beneficiary receiving a lump-sum payment at the time of
death, the Installment Payout Option gives you the power and control to choose guaranteed, pre-determined installment payments when the policy is purchased.
Is the Installment Option Less Expensive ? Can I Buy More Life Insurance With the Same Premium Payments?
Yes, this option is less expensive. The longer the deferral period, the lower the premium payments will be. Premiums can be as much as 40% less on an annual basis.

Is the Installment Option Better Than a Lump-Sum Option?
Neither option is “better” than the other. An increasing number of life
insurance buyers are concerned about the risks of leaving a lump-sum death benefit to their beneficiaries. For them, the Installment Option may be best. Life insurance owned for estate tax planning is a good example of when a lump-sum option may be a more appropriate alternative.
How is the Deferral Schedule Determined?
We encourage every life insurance buyer to meet with a life insurance professional to consider these options, and others. Your income, debt levels,
other assets, fixed and variable expenses, education, retirement assets and inflation are some of the elements in the calculation.
Can I Change the Payout Option from Installment to Lump-Sum?
Some insurance companies allow for this. Unlike the lump-sum option that is very limited from a planning perspective, the Installment Payout Option allows for customization by each policyholder.
Can I choose a Blend of Lump-Sum and the Installment Option?
Yes. Most people appreciate the ability to customize their life insurance
policy by combining a lump-sum payment with installment payments over time.
Can I Upgrade My Existing Insurance to the Installment Option?
Yes. By doing so, you may be able to lower the premium payments or
increase the death benefit for the same premium you pay now.
Can a Beneficiary Make Changes to the Installment Schedule?
No. However, the installment payments are an asset that can be sold at a
discount. We recommend a trust be considered as the policy owner, with an
informed trustee to ensure the insured’s intent is honored.
What if My Health Has Changed Since Last Purchasing Life Insurance?
If you have had a material change in health, be cautious about giving up
any existing coverage without a careful analysis. Consult with us to help evaluate your options. By choosing the Installment Payout Option, you may be able to neutralize the impact of a higher premiums.
What Insurance Companies Underwrite the Installment Payout Option?
The Installment Option is available from several of the most highly rated life insurance companies in the United States.

Please call me at 561-869-4500 or email me, Ted Bernstein, about a complimentary review of your existing policies.

December 17, 2019
The Best Life Insurance is No Medical Exam, No Blood, No Wait. In One Phone Call Get Covered Up To $5Million.
What do Barbara Eden and Elizabeth Montgomery have in common with buying life insurance today?

Magic!

As fast as they blink and twitch is all the time it takes to buy the best life insurance available in the market today. Apply and Buy is done without a medical exam, without lab tests or without the traditional underwriting hassle. Everything is done online with the guidance of experienced professionals. Whole life insurance, term life insurance, permanent life insurance are all available, up to $5,000,000. For qualified prospects, no traditional underwriting means:
1. No bloodwork, no needles. No other body fluids necessary.
2. No visit from the doctor.
3. For approved candidates, issued and paid in an hour.
The Need For Speed.

Consumers today expect everything done quickly. Many people do not review or upgrade their existing life insurance coverage because they dislike the process and it takes too long. But speed alone is not all it takes to make a great life insurance experience. Considering it is among our most important assets, quality is equally important. Without exception, the insurance companies underwriting these programs are market leaders.

Welcome to the future where you can buy the most competitive life insurance coverage in a single phone call. By collecting information such as prescription history, DMV reports and typical credit and consumer information, you will get a policy in a fraction of the time and none of the aggravation.*

Everything is done online. In one sixty minute phone call, you can apply and buy up to $5,000,000 of coverage. Everyone under age 65 is a candidate. Therefore, if you have been putting off the decision to review or upgrade your coverage, now is the perfect time to speak us.

What Type of Policies Are Eligible for Accelerated Underwriting?

Term and permanent policies are eligible, including whole life. There is no difference between these products and the ones available through traditional underwriting, which is the biggest concern people state for not upgrading their existing life insurance coverage. People realize that policies are better than ever before but at least 50% report taking no action. Enhancements like living benefits, vitality pricing, lifestyle credits and lower premiums are not enough to overcome the hassle of underwriting.
The typical concerns stated by most people include:
- the exam process.
- aversions to needles for blood.
- disclosing height and weight.
- fasting.
What About Living Benefits?

Living Benefits are available with accelerated underwriting. The value of Living Benefits is that they allow you to draw against the face amount of the policy if you have a qualifying health emergency. Every life insurance policy should include Living Benefits, without exception, since there is no additional cost.

Please contact me at 561-869-4500 or complete the contact form on this page to schedule a complementary discussion.

* Applicants may not qualify. Insurance companies retain the right to ask for additional medical information based on the initial application.
November 26, 2019
What Happens When A Term Life Insurance Policy Is Ending?
I am often contacted by owners of term life insurance policies when the policy is nearing the end of its guaranteed term period. Whether that is 15 or 20 years from when it was issued, people want information about their options at this very important time. Like many things involving insurance, reaching out for a life insurance professional is your best bet. Understanding the options will provide comfort and clarity. Because nothing about life insurance is one size fits all, there are no simple answers here. The end of a term insurance policy brings the need for life insurance into focus again. Typically, healthy people have good options to buy new insurance. An expiring term insurance policy should be treated like the purchase of new insurance. How much coverage is needed, for how long and what type are important questions to consider.

Deciding how long a life insurance policy should last is one of the toughest decisions we face when buying life insurance. The duration is a huge factor in determining the policy’s premium. The longer you want a policy to last, the higher the premiums will be. In contrast, the sooner you can lock in a permanent insurance rate, the less it will be over time. For those who prefer to minimize future costs, permanent insurance is more economical. Permanent life insurance has a much lower net cost than term.

Knowing that permanent life insurance has a much lower net cost than term insurance, why do people stay with term longer than they should?

In a perfect world, everyone wants lifetime coverage for the cost of term insurance. But, when we are young, term is easy on our budgets and life expectancy seems like a hundred years away. Younger insurance buyers are often led to believe they won’t need insurance in the future because:
1. their kids will be grown
2. other assets will have increased, and
3. their spouse won’t need liquidity when the kids are gone.
In reality, we get older quickly and our feelings about how long we want life insurance change – ask anyone over 50. In our 30’s and 40’s, we might think we only need coverage until retirement or when the kids are self-sufficient. In situations of divorce, everything changes. Many people choose term insurance hoping to replace it with a better policy when cash flow improves, before the term policy ends. Unfortunately, that is not what happens. Data strongly suggests that life insurance reviews are easy to kick down the road. Fifteen or twenty years passes quickly, making the flaws of term insurance painfully clear.

The number one problem with term insurance is that it lapses before it is needed most. After the initial term period, the much higher renewal premiums may be unaffordable and they catch people surprised and unprepared. A 55 year old may now have health issues. If health has changed, the problems begin to compound. Older age and less healthy combines to make term coverage far less desirable, making this the first time people realize that term insurance may have cost less when they were younger, but it is not better value. It simply cost less in our low risk years.

What to do with current, inforce policies?

Life insurance buyers can benefit from innovation, technology and science. However, it is likely that your current policies are not receiving these enhancements. For example, new policies allow people to take an accelerated benefit against the face amount of the policy, at no cost, when they have a health emergency. In the proper policy, a $2,000,000 policyholder is eligible to take more than a million dollar advance from the face amount, under the illness rider. There may be zero cash value in the policy but it remains eligible for an advance because these advances come from the face value, not the cash value.

In order to take advantage of these innovations, life insurance owners only have to let an experienced agent do a market review.

Another innovation, apply and buy, allows people to get up to $5,000,000 of coverage approved and issued online, in one meeting, without submitting any doctor records, blood, urine, or taking a medical exam. The rates for expedited policies are exactly the same as they are for people who are underwritten traditionally. There is no additional cost for this remarkable convenience. Whether it is term, whole life, universal life or term to 100, the coverage can be applied for and issued in less than an hour.

Innovations in cash value policies are equally remarkable. In the right indexed universal life policy, the insurance company GUARANTEES there will never be market losses, only gains. Indexing strategies are transforming the uses of life insurance.

For people older than 70 with expiring term insurance policies, they should consider selling the policy in the secondary market rather than just letting it lapse. The policy may have no value, but it is possible. A few months before the policy lapses, getting a valuation makes sense.

Give us a call at 561-771-4647 or email TB@LifeCyclePlanners to get started. I offer a complementary phone call about your current life insurance concerns.
October 29, 2019
Selling Un-Needed Life Insurance Gains Acceptance
Selling un-needed life insurance policies in the secondary market is now considered mainstream. It is a noteworthy development when class action lawsuits against life insurance companies are brought by policyholders. Should you sell an un-needed or unwanted life insurance policy? Most qualified sellers are happy to learn about the benefits of selling their policy in the secondary market. It pays to seek the guidance of a professional when dealing with life insurance matters. Selling an un-needed life insurance policy in the secondary market is known as a life settlement transaction.

Unsure about it? Ask your CPA or tax attorney about life settlements. Those with life insurance experience are advocates. I advise potential sellers to only work with insurance professionals to help maximize the value of an unwanted or un-needed life insurance policy. The right professional will make you aware of issues such as potential income taxation.

Selling un-needed life insurance policies is all about the value.

To determine the value of a policy you are considering selling, potential buyers need the following information:
1. The required premiums to keep the policy inforce to life expectancy.
2. The type of policy and its terms.
3. Your life expectancy which is measured by an independent, 3rd party specializing in this practice.
4. A detailed history and understanding of your current health and past health.
With this information, you should get initial offers. Typically, there is minimal value for policies owned by people under the age of 70. If there are health considerations leading to a shorter life expectancy, that may change the numbers in your favor. I recently helped a 77 year old woman sell a $2,000,000 policy she purchased at age 54. Because of previous medical history, she received a bit more than $400,000, net. Some clients I’ve helped have only received offers of 4 to 5 percent of the face amount.

If you have a policy you may no longer need or want, there is no downside to knowing its value.

Please email me at Ted Bernstein or call me at 561-869-4500.

ted bernstein, selling your life insurance, ted bernstein boca raton, ted bernstein insurance
June 25, 2018
The Longevity Story

Longevity is extending. Both science and technology are on the verge of solving many every day problems of aging. What if we could not only add years to our lives? What if we could spend those years being physically fit, functionally independent, emotionally and mentally healthy? To do this, we must make ourselves FINANCIALLY SECURE through plentiful amounts of guaranteed, lifetime income?

At that point, it is no longer a story about old age. We have a story about long life!

Read more about longevity risk:

http://www.investopedia.com/terms/l/longevityrisk.asp

https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=17&cad=rja&uact=8&ved=0ahUKEwivofism-vSAhVP6GMKHdu9AlEQiBUIbjAQ&url=https%3A%2F%2Fplus.google.com%2F114674288256493099531%2Fposts%2FZBnygLHNoXQ&usg=AFQjCNGDDCF2yiuSBPXppEbcbN_nL9zsMA&sig2=nPbXUXWPjGd9s379q6sZuA

http://www.institutionalinvestor.com/article/3373646/investors-pensions/the-rising-challenge-of-measuring-and-managing-longevity-risk.html#.WNMC4O-guUl

December 16, 2016
Lower Your Life Insurance Premiums With A Smart Hybrid Policy – Protect Your Beneficiaries Better.
Lower the Cost of Your Life Insurance and Protect Your Heirs the Way You Intended:

Until now, life insurance buyers did not have an option to structure the payment of the policy’s proceeds to their beneficiaries. All that has changed – now you have the control to design the payout exactly as you want them paid. Why does this matter?

Turning the proceeds into guaranteed payments by the insurance company LOWERS THE ANNUAL PREMIUMS as much as 40% and protects the proceeds from every kind of risk.

Do you want the beneficiaries of your life insurance policy to receive a lump sum? One of the most important things you can do for your heirs is to protect them exactly as you intended when you decided to purchase life insurance. Remarkably, life insurance proceeds only last, on average, 3 years! Ask any parent or spouse if they INTEND the proceeds to be gone in 3 years. That is never their intention.

The perfect plan guarantees the number of payments you choose, turning the proceeds into payments that can never be mismanaged. With interest, the insurance company makes structured payments to your beneficiaries based on the plan you create when you set up the policy. Everything is guaranteed. You can change the plan anytime.

For example, instead of a $2,000,000 lump-sum payment, your beneficiaries can receive equal payments of $200,000 for 10 years. Or equal payments of $100,000 for 20 years. How about a plan that pays $500,000 upon death and 10 more equal payments of $150,000? Each person is different and now, each person can customize the payout to meet their precise, individual needs.

It gets better. The premiums can be as much as 40% lower every year depending on the time frame you choose. Or, for the same premium in your current policy, you can increase the amount of insurance up to 40%!

The “Installment Payout Option” allows the policy owner, at the point of purchase, to choose how many years to defer these payments.

Win –Win: You either purchase up to 40% more life insurance for the same premium as a lump-sum payout or lower your annual premiums up to 40% every year. By choosing a greater number of payout years, the ANNUAL SAVINGS is increased.

The surge in annuity sales over the past several years is evidence that principal protection and guaranteed results are critically important to millions of consumers. “This groundbreaking alternative is the perfect life insurance solution”, says Ted Bernstein of Life Cycle Financial Planners. And, it is available for both term and permanent coverage.

Why upgrade to the Installment Payout Plan?
1. Transform lump-sum proceeds into guaranteed installments.
2. Offers the most competitive premiums available – everything GUARANTEED.
3. Reduces premiums as much as 40% for same amount of death benefit.
4. Protects life insurance proceeds from market risk.
5. Tremendous flexibility, installment periods between 5 and 30 years.
“The biggest challenge we face is raising awareness of this important option”, says Ted Bernstein, Owner of Life Cycle Financial Planners. “Almost everyone can upgrade their insurance coverage and we are uniquely qualified to help our clients…even smokers and people paying more for rated policies.”

Please call us at 561-869-4500 and let us help you compare your existing policy with the benefits of the Installment Payout Option. Or, email Ted.

Make sure to inquire about Life Insurance with living benefits and turn the face amount of your life insurance policy into an emergency health insurance fund.
October 20, 2016
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October 13, 2016
How Much Life Insurance Should You Buy?

Term Insurance Rates Are Remarkably Low! How Much Life Insurance Should You Buy? From Who?

It is important for consumers to have a good understanding of how inexpensive term insurance really is to own. Once you engage with a professional to start the process, a robust discussion will usually follow about “how much” coverage do you need to meet your goals and objectives. From there, you should learn about state of the art innovations to reduce premiums, create value and increase flexibility. Maximum flexibility and the ability to customize for most people, is more important than anything else.

The Installment Payout Option – Just one example: Most people buying life insurance today for income protection prefer to have the proceeds paid to their heirs in a partial lump-sum with the balance paid in equal, guaranteed installments over a time period they choose. Life insurance buyers now can control how the proceeds are paid to their beneficiaries at the time they purchase the policy. Until recently, beneficiaries were always paid in a lump-sum. Now, at the time of purchase, you instruct the insurance company to pay GUARANTEED, pre-determined payments over a time period you selected. The premiums can be up to 40% less, EVERY YEAR!

Things change as time goes by. The Installment Payout Option allows you to re-design the structure of payments at any time to meet the needs of your family, without underwriting.

Still, too many people are only concerned about the minimal premium differences among different insurance companies. They key is to work with a professional to first customize exactly what you need and want the policy to do in the short and long term. Not doing so is the equivalent of going into an auto dealership and demanding the least expensive car without first “building” the car to meet your unique goals and objectives. Worse is the fact that most people are not aware of these relevant innovations that can now be customized into your policy. More and more insurance companies are creating products that allow experienced professionals to design the perfect policy for you.

I offer a complementary consultation, by phone or in person, which is designed to help you explore the innovations that now exist and to determine if I am the right professional for you. I have 30+ years of experience that will ensure you end up with the perfect plan and products for you.

Send an Email to Ted Bernstein or call my direct number at 561-869-4500. Upon request, I can provide you with many clients or professional advisors who can speak to the experience of working with me and my family.

September 22, 2016