A standard life insurance policy typically pays out death benefits to the named beneficiaries in the event the policyholder dies unexpectedly. In exchange, the policyholder pays premiums throughout the term of the policy, that is, during their lifetime. However, if the policyholder wishes to terminate this arrangement for one reason or another, he/she can decide to sell the policy to someone else instead of canceling it outright, allowing the policyholder to recoup his/her investment in the policy. However, selling a life insurance policy to a third party is often a complicated process. Here are five tips to make the process of selling life insurance easier.
- Understand the Process
While the process of selling your policy to someone else can be complex and difficult, it is not impossible. To navigate the process successfully, you need to understand what the process entails, including the state regulations surrounding the selling of these policies. Additionally, understand the type of life insurance coverage you have and coverage size.
- Consult an Expert
As mentioned earlier, selling a life insurance policy is a complicated process. This means that it is prudent to seek help from an independent yet reputable advisor even if you seem to understand it. A life insurance advisor will help you in several ways. Firstly, they can assess the value of your life insurance policy on your behalf, making it easier for you to determine the right offer. Secondly, they can refer you to suitable brokers in the field. Lastly, they can point out attributes of your life insurance policy that can either increase or decrease its value.
- Use the Right Broker
There are currently over 420,000 insurance brokers and agencies in the U.S. Without conducting proper research, you may end up hiring an unprofessional broker that will ruin your experience. Therefore, research the market well and ask for recommendations for reputable brokers that can help you navigate the process quickly. Also, ask whether you are eligible for any discounts and transaction costs before proceeding.
- Compare Multiple Offers
When you put your life insurance policy on sale, you will likely get multiple offers depending on your marketing efforts. If you do, analyze them carefully and only settle for the most suitable offer. Take note that when you sell your life insurance policy, the amount you make from it will be lower than the death benefits. While you should be ready to make less money, don’t just settle for low offers. You can negotiate better offers with the help of your insurance broker.
- Gather All the Documents Required to Process the Transfer
Once you get the right offer, ensure you gather all the documents needed for processing the transfer. This is because potential buyers will likely want to see your paperwork to gauge the policy’s value and make a buying decision. Therefore, collect all your medical records dating up to 5 years back and any life insurance documents and present them to the buyers. Remember to walk with your broker every step of the way.
How to Obtain the Perfect Life Insurance Policy
Reach out to us at Donald Weiss Insurance Services for a life insurance policy that suits your needs and budget. Contact us today to get started on your personalized coverage.