A: A Life Settlement is the process of selling an existing life insurance policy to a third party for a percentage of the policy’s death benefit.
A: In most states, the life settlement transaction is regulated by the Department of Insurance. A policy owner is permitted to contact a broker, licensed in their state of residence, to assist in selling their policy. The broker (Whitestone) will gather all the necessary medical and policy documents and obtain a medical evaluation of the insured party. The licensed broker will then submit all of the information to providers (buyers) licensed in the policy owner’s state of residence. These providers then make offers to purchase the policy. The broker presents the offers to the policy owner. Upon acceptance of an offer, contracts are generated and signed, and purchase funds are placed in escrow. Upon confirmation of the change of ownership of the policy, funds are released to the seller, and the process is complete.
A: Whitestone Life is a licensed broker that gathers all pertinent medical and policy information on behalf of the policy owner. Once all information is acquired and a medical review is obtained, Whitestone will work with our network of professional buyers to obtain multiple competitive offers for the policy. We will leverage these offers to obtain the highest purchase offer available in the industry. At the end of the process, we will share all of the offers that we have received for the policy. In almost all cases, our recommendation will be to accept the highest gross purchase offer that we have provided.
A: Whitestone will accept most types of policies, including term life insurance, universal life insurance, whole life insurance, joint survivorship life insurance, group life insurance, or key-man life insurance.
A: Whitestone’s goal is to complete most transactions within 30 to 45 days. The most significant factor is gathering the insured’s medical records. Occasionally, obtaining complete and accurate data regarding the insured, seller, insurance company, and/or policy may take additional time to accomplish and can slow down the evaluation process. Whitestone works diligently to speed up the process and will keep in constant contact with the seller or seller’s representative throughout the entire process.
A: The amount to be paid to the owner of a policy depends upon various factors, such as medical condition, age of the insured, amount of future premiums necessary to keep the policy in force, and the cash surrender value of the policy.
A: Yes. All Whitestone personnel are guided by the highest standards of confidentiality. No medical, financial, or other personal information about the seller and/or the insured that Whitestone obtains will be disclosed to any other person or entity without written consent, unless required by law.
A: Most states offer a 15-day rescission period. The previous policy owner can change their mind and get the policy transferred back within 15 days after receiving the funds. They will be required to refund the purchase price and any and all fees and premium payments paid by the buyer.
A: No. Whitestone will contact only the insured’s physicians for existing medical information.
A: The new owner covers all future premium expenses.
A: There are no restrictions, and sellers are free to use the proceeds however they wish.
A: No. There is no cost or obligation to the seller. There is not even an application fee.
A: Yes. Remember that once a life insurance policy is issued and put in force, it is the property of the contract owner. Much like any other asset, the policy owner has the right to dispose of the policy in any manner that they may choose after the contestability period has passed. Options may include holding the policy until maturity, surrendering it for its cash value, lapsing the contract, or selling it for an amount higher than the cash value and less than the policy face amount.
