Viatical SettlementsViatical settlements are lump sums of cash given to terminally ill people (viators) in exchange for the death benefits arising from their life insurance policy. Investment returns are dependent on the expected life span of seller's and the actual date they dies. Higher returns are possible if the seller dies before the estimated life expectancy, but lower returns are also possible if the seller lives beyond the estimated life expectancy. Investors can even lose a substantial portion of the principal investment if the person lives long enough so that additional premium payments are required to maintain the policy in force. The investor pays a percentage of the face value of the policy and in return for that payment becomes the beneficiary of the policy. are risks to both parties. The primary risk for the Viator is settling at too low a price. On the investors side, there are risks of the insurance company goes bankrupt or not receiving any death benefit if the insured put forth a fraudulent insurance application. Viatical settlements have been called risky investments. A thorough investigation with a Certified Financial Planner should be made before you considering investments in a viatical settlement. Most state insurance commissioners require companies to be licensed in order to buy viatical settlements for sale to investors. These companies may have information about specific viatical settlements. The National Association of Insurance Commissioners can provide you information on licensed companies in your state. The Federal Trade Commission also has information for those who are considering selling their life insurance policies for Viatical Settlements. |
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Menu Eligibility for Viatical Settlements Insurance Viatical Settlements Tips for potential investors in viatical settlements What are Life Insurance Settlements Investing in a viatical settlement involves risks Secrets to successful viatical settlement investing
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