Insurance settlements offer a way out for those trapped by the downturn in the economy
Current economic conditions in the United States has forced everyone to make decisions about their financial future. Unemployment has constantly been on the rise, healthcare costs are higher than ever, and consumer confidence is at an all-time low. These effects have been magnified among seniors. Because of their age, many of them don't have time to make up money that they've lost. That reality is added to the fact that they have higher health costs than younger people and lower income. As an option, many seniors have life insurance policies that they've dutifully been paying into for years. The policies have a cash value that seniors can receive if they wish to surrender their policies. That value is determined by the insurance companies who have no interest in offering a competitive rate because they've had their customer for years.
Fortunately for seniors, insurance settlements are a viable option that, more often that not, can result in a higher payout than what the insurance companies will offer. The amount of most cash values is comparably tiny compared to the policy's face amount and compared to how much money has been paid into the policy. Because more people are becoming aware of how much money the insurance companies are keeping when a life insurance policy is surrendered, the insurance settlement industry has grown quickly. An insurance settlement company will examine a life insurance policy and make an offer in exchange for signing the policy over to them. Either way, the policy is being surrendered. If it's to the insurer, the senior will only be receiving the amount the insurance company wants to give. If it's to the insurance settlement company, there are potentially hundreds of companies competing for that piece of business. The only difference between the two options is how much money is being paid for the policy, everything else remains the same.
Insurance settlements put more money in the average senior’s pocket
Surveys have shown that insurance settlements offer a better value more than half of the time. Every time someone chooses the cash value of their policy, as determined by the insurance company, rather than a higher valued option from an insurance settlement company, that profit is going into the insurance company's bank account rather than that person's pocketbook. These differences are not trivial either, some have been as high as $100,000. That is potentially a ton of money that is being abandoned. Even more dismally, on average the older the senior, generally the larger discrepancy. This is because they've usually been paying on the policy for a longer time. Furthermore, in many of these particular cases, these older seniors are harder hit by economic downturns than others. They stand to earn more from insurance settlement companies than others which is good because many of them don't have alternatives in the working world. But greater acceptance of insurance settlements have led to it becoming a multi-billion dollar industry. An insurance settlement provides possibilities that haven't always existed in dealing strictly with the insurance companies, but now the tide is starting to turn which only helps seniors.
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