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Case Examples

A 79 year-old male owned a universal life policy with a face amount of $1.5 million. Originally purchased for estate preservation, the client could no longer afford premium payments on the policy. Rather than allowing the policy to lapse, his advisor suggested a policy valuation. Coventry First provided the client with $196,000 for a policy that otherwise had no cash surrender value, which he used for immediate retirement expenses and supplementary income.

The 73 year-old policyowner and his spouse originally purchased a $3 million survivorship universal life policy 12 years ago for estate preservation. A couple of years after his wife passed away, the client approached his advisor because he no longer needed the coverage and could not afford premium payments. Rather than allowing the policy to lapse – since it had no cash value – his advisor suggested a policy valuation.Coventry First provided the client with $270,000, which he used for supplementary retirement income.

In 2002, the client purchased three $1.35 million term policies for business purposes. Two of the policies were used to cover a loan, and the third policy was used as part of a buy/sell agreement. The client’s company eventually declared bankruptcy and he could no longer afford to pay the premiums. Now 68 years-old, he took ownership in his trust in order to keep the policies, but was concerned that they would lapse. He discussed the situation with his advisor, who suggested a policy valuation.Coventry First provided the client with $164,750 for the policies, which he used to fund his retirement.

Discovering hidden value.

Life settlements have changed the way we think about life insurance. For consumers, life settlements and the secondary market for life insurance have unlocked the market value of life insurance, transforming unneeded policies into assets with significant value.

One Transaction. Multiple Applications.

A life settlement is a financial transaction in which a policyowner sells an unneeded life insurance policy for more than the policy’s cash value and less than its face value. But life settlements represent much more than an exit strategy for unneeded life insurance policies. With the assistance of an experienced advisor, a life settlement can be a springboard to achieving a client’s broader financial objectives.