Since a Supreme Court decision in 1911 life insurance policies have been considered a transferrable asset much like any other investment such as real estate, stocks and bonds. The market for life insurance settlement derivatives is a fast growing industry that is fairly new to the financial markets. The market has really opened up as a well regulated and viable form of asset transfer since in 2001 the National Association of Insurance Commissioners (NAIC) took a vital step in drafting the Viatical Settlements Model Act outlining proper guidelines for preventing fraud and protecting all parties by ensuring acceptable business practices. Once this was done the large corporate players began to work with life insurance settlement brokers in order to purchase these assets.

When you have your life insurance quotes before you as you are making the decision on how much coverage, consider the possibility that even should you never collect on the policy, once you are fully vested in the policy you may have the option of selling the policy through a life insurance settlement broker for a sum somewhere between the cash value and the face value. This can be a mutually profitable arrangement, but before you accept an offer of life insurance settlement insist on full disclosure of all costs, taxes and commissions be part of your life insurance quotes.

In general, the life insurance settlement is targeted to high value policies. With that in mind be sure to select a level of coverage that would allow you to if need be have a viable product to resell in this growing market of life insurance settlement. The process is primarily for retired individuals who are liquidating their assets and upon inspection of their portfolio find they no longer need the high value life insurance policy. However one must take care because you can’t have your cake and eat it too, if you sell the asset you no longer have the protection of life insurance.