4 Things You Shoud Know Before Doing A Life Settlement
A life settlement can give you some much needed cash. However, it can be very confusing trying to decide who to sell your policy to. If you are not quite sure about what you should ask before you sell your policy, then here are four major things that you should know the answers to.
Find Out About Licensing
Any life settlement agent that you are using should be licensed by your state. You can ask the state insurance commissioner about the broker you are considering. You can also find out if any complaints have been filed against them and the nature of the complaints.
Find Out What Will Happen To Your Policy
Once you sell your policy it will be out of your hands. Your policy contains a lot of information about you. Make sure that you are comfortable with giving out your information. Find out if the broker will keep the policy themselves or sell it to a third party. Ask who these third parties are and find out about them. You do not want sensitive information about your life to get into the hands of unscrupulous people. Identity theft and fraud are very real and is often carried out when criminals get private and personal information.
Remember too, that the broker will want to know your medical history in order to assist with pricing the policy. Selling your life insurance policy also means a commitment to providing regular health updates to the broker.
Find Out If You Will Be Taxed
Depending on which state you live in and your personal situation, you may be charged tax on your life settlement. It is always best to seek out the services of a tax professional, so that you can find out if you will be taxed.
Find Out About Transaction Costs
Unfortunately, most life settlements come with a very high transaction cost. That is because all of the major players in the settlement must get compensation. Ask about how much your broker will be paid from the transaction and find out how much other parties involved will be paid. A firm knowledge of how much will be taken as commission will give you a better idea of how much you will be paid once the transaction is completed.
Selling your life insurance policy is a big decision, make sure you are armed with all the facts before you sign over your policy to a broker. Contact a company, like Alternative Strategies Insurance Solutions, to get started.