Selling $3 Million Policy Helps Senior Couple Fund Grandchildren’s College Education

With the Holiday Season in full swing, the spirit of giving surrounds us.  

For older retirees with grandchildren and great grandchildren, the concept of “giving while living” and providing an enduring legacy becomes a higher priority. 

Rather than treat their grandkids to Black Friday shopping sprees and shower them with toys, video games, or concert tickets, many older seniors are thinking longer term.  Their priority is to leave an enduring legacy to their grandchildren – such as the gift of a college education.

But considering the price tag for a higher education, some grandparents may think such a gift is out of their reach. After all, college tuition has skyrocketed over the past 20 years, and funding a college education requires cash – lots of it.

For seniors who find themselves digging around for extra cash for gift-giving or charitable causes, the solution may be surprising. Selling an unwanted life insurance policy may be the answer.

During this season of giving, financial advisors and tax professionals have an opportunity to inform their senior clients about the unlimited ways to use the cash from a life settlement.

$1.2M from selling policy helps grandparents achieve a lasting legacy

Asset Life Settlements was honored to help this senior couple in their 80’s achieve financial stability and leave a meaningful legacy behind for their grandkids.

The couple’s insurance professional explained that the couple owned a $3 million life insurance policy that had been purchased many years ago for estate planning purposes. But over the years, circumstances changed and the coverage was no longer necessary. The annual premium of $98,000 was draining their cash resources which the couple needed for other purposes.
The agent agreed with his clients that it no longer made sense to maintain the coverage and explored various options with them – including selling the policy in the secondary market.

The agent contacted us on his clients’ behalf to request a preliminary estimate of the policy’s value. Based on our appraisal, the couple requested that we negotiate the sale of the policy to the highest bidder.

We submitted the case to more than 20 potential buyers in the secondary market and were successful in generating 15 offers from multiple sources. The lowest bid came in at $650,000, and following a rigorous competitive bidding process, we were successful in negotiating the amount up to the highest bid of $1.2 million.

The couple and their agent were thrilled with the outcome, as the final offer far exceeded their expectations. They earmarked the proceeds from the sale of the policy to supplement their retirement, fund their grandchildren’s education, and travel.

Reminder: Receiving the highest offer for a policy requires using a broker

This success story clearly illustrates the importance of using an experienced life settlement broker such as Asset Life Settlements. By selling a policy to the first buyer who makes an offer, the client will never know whether they could have received a higher offer.

That’s why it’s important to sell with confidence by working with a broker.

As we’ve noted in previous articles, many retirees are prompted to sell their policies after viewing TV ads from life settlement buyers offering to pay top dollar to purchase their policy. Once the check is cashed, it’s common for policy sellers (or their insurance agents) to second-guess whether they could have received a higher offer. Unfortunately, it’s too late.

Take Away

In today’s wobbly economy, cash is king, especially for retired seniors.

Financial professionals have an important, albeit underutilized, tool (i.e. life settlement) to help seniors achieve their retirement and gift-giving goals. Repurposing the asset value of their unwanted life insurance policy has unlimited applications and possibilities.

This Holiday Season, help your senior clients achieve the magic of gift-giving that endures forever.