Advisors
When clients’ needs change, life settlements provide greater flexibility in making adjustments to financial strategies. This planning tool now allows policyowners to tap previously unrealized value in their unwanted, unaffordable, or underperforming life insurance policies. Like other assets, a life insurance policy can now be liquidated for fair market value with the unrestricted proceeds redistributed to address the current financial planning goals of the owner. Whatever the current needs, make sure you understand the opportunities a life settlement may provide your valued clients.
If you have a fiduciary relationship with a client, informing that client of an available beneficial opportunity like a life settlement may be required. Even if your relationship is not precisely that of a fiduciary, staying informed and giving the best and most complete advice is advantageous both to you as an advisor and to your clientele.
A life settlement can provide the best solution for clients in an array of situations. Some of the more common reasons are grouped by the following types of policyowners:
An advisor who makes a client aware of the life settlement option adds value to the service provided to the client, because the client is in a better position to make an informed decision. This results in higher client satisfaction and loyalty. The funds realized in a life settlement transaction also create new opportunities for the advisor to provide additional services to the client.
The ultimate question for advisors is: “Would a life settlement effectively help meet this client’s estate planning or financial needs?”
Generally, eligible candidates for a life settlement own a policy with a face amount of at least $100,000 that is past the two-year contestability period, insuring an individual 65 or older who has experienced a change in health since the policy was put in force.
The sale of a life insurance policy is a significant step for the policyowner. Professional advisors should perform due diligence and consider such issues as the tax effects of a life settlement, probate and estate considerations, and a client’s insurance and financial needs.
More than simply having an “awareness” of the secondary market, advisors like yourself need to know you have the complete support of a firm that will provide you with the services needed so that you can continue providing your clients with the exemplary level of service they expect from you. Brookwood Settlements has the superior knowledge of the secondary market and experience to provide this support. Throughout the process, Brookwood attorneys team together with our clients’ advisors to ensure clear communication and an optimal outcome.