Selling a life insurance policy through a life settlement can be a strategic financial decision, especially for seniors seeking to access cash for medical expenses, retirement, or other financial needs. However, completing this process requires careful preparation and documentation.
Two crucial documents are indispensable:
- The original life insurance policy
- Medical records release form
Here’s why these documents matter and how they contribute to a smooth transaction.
Document One: Life Original Insurance Policy Or Certified Duplicate
The life insurance policy document contains essential information about your policy, including the face value, premium structure, and policy type (whether it’s term, whole, or universal life insurance). Buyers and settlement providers need this document to verify that your policy qualifies for a life settlement and to assess its value. Since this document will be required as part of the closing process, keep this document handy.
If you do not have the original document or a certified duplicate, you must request one as soon as possible. Carriers can require 30-60 days to process your request. So do this first without delay.
The ‘Annual Statement’ Also Required For Whole Life And Universal Life Policies
Another document, for those with permanent products like whole and universal life policies, should request the most recent annual statement which is usually sent to policyholders from carriers annually on the anniversary of the policy’s issue date.
What It Provides
- Policy Ownership Information: Identifies the current owner of the policy.
- Beneficiary Details: Specifies who would receive the policy payout upon death.
- Premium Obligations: Lists the required premium payments to keep the policy active.
- Policy Type: Helps the buyer understand the flexibility and potential long-term costs associated with the policy.
Document Two: Medical Records Release Form (HIPPA Authorization)
A life settlement transaction involves evaluating the life expectancy of the insured individual. Buyers and underwriters need access to your medical records to make an informed assessment. The Health Insurance Portability and Accountability Act (HIPAA) authorization form allows the settlement provider to legally obtain these records.
What It Provides
- Health History Information: Provides insight into any medical conditions that may affect life expectancy.
- Life Expectancy Evaluation: Essential for determining the offer amount for your policy.
- Risk Assessment: Helps buyers gauge the overall risk involved in purchasing your policy.
How to Obtain and Complete It
You can typically get a HIPAA authorization form from your life settlement broker or directly from the life settlement provider. Ensure that you complete the form accurately and sign it before submission.
Any buyer you consider will want to review medical records.
Signed Releases For Medical Records
Gathering medical records can be time-consuming and frustrating at times. Windsor can do this part for you. By completing our inquiry form, you authorize Windsor to manage the required emails and phone calls on your behalf. Keep in mind, the life settlement process is always faster if you do this part, but we are happy to manage this process for you.
Once we receive a copy of the policy and complete medical records, we can give you an idea of what the cash offer will be.
It’s important to note that Windsor takes your privacy very seriously. We don’t share your personal information with anyone.