Stop paying premiums using LifeCon™
to read real-life examples
of LifeCon™ in action!
When changes in your life affect your financial situation, you may look at your current life insurance policy differently. In the past, your choices were limited to either letting it lapse or surrendering it for any cash value. However, if you’re over 70, recent developments in the life insurance industry make it possible for you to sell a policy for more than its current cash value and lower – or even eliminate – your premiums on a new replacement policy.
Selling an existing insurance policy is more commonly known as taking a “life settlement.” Companies that purchase policies are often backed up by large financial institutions that buy any type of policy, including term insurance – which has no cash value. Generally, the criteria for purchase include:
- Policy is over two years old,
- Face amount of policy (or policies) is $500,000 or greater,
- Insured has had a change in health and
- Insured is over 65.
Virtually any type of life insurance policy from any carrier, including individual term, whole life, group, corporate-owned, second-to-die and policies held in irrevocable life insurance trusts, can be sold for more than the current cash value. LifeCon takes the life settlement concept one step further and, if you meet the criteria, you may experience its benefits in several ways:
- Dramatically reduce, and sometimes even eliminate, premium payments by investing the proceeds in a new replacement policy,
- Provide cash for alternative financial products,
- Use sale proceeds to fund a long-term care policy,
- Make gifts to family members,
- Provide funds for charitable gifts,
LifeCon is a better alternative to lapsing or surrendering an existing insurance policy that you no longer need and/or can afford. As part of the estate planning process, Mike Kilbourn will review your life insurance situation and show you several solutions using LifeCon.
Ann O. (age 76)
Ann had a $5 million policy, purchased 7 years earlier with a premium of $140,000 per year. We were able to sell her policy in the secondary market and get her a new $5 million policy at $89,789 per year – saving Ann over $50,000 per year.
Jerry K. (age 64)
Jerry saw our ad and approached us about an old $750,000 policy that had run out of cash value and he was going to let it lapse. We arranged to sell the policy in the secondary market for over $132,000 cash.
Bill S. (age 80)
Using one of our creative concepts, we were able to offer Bill the option of either replacing his $5 million policy with a $7 million policy (guaranteed to age 121 with no additional premium) or reduce his out-of-pocket costs on a $5 million replacement policy by approximately $83,000 per year. He even had a third option of a lower premium plus receiving a check for $500,000.
Harold S. (age 89)
Harold was tired of gifting $300,000 to his irrevocable life insurance trust each year to cover the premiums on a $5 million policy on his life. Instead of cashing in the policy for its net cash surrender value of $1,240,000 or taking a paid-up policy for $2.5 million, Harold chose our LifeCon strategy and was able to obtain a competitive bid from a Life Settlement company for over $3 million in cash. Harold’s trust used the tax-free funds to invest in alternative financial investments.
Mr. and Mrs. S. (ages 81 and 81)
Mr. and Mrs. S. called to ask if we could help them save money. We were able to reduce the premium on their $5 million policy from $81,000 per year to $58,473 – a cost savings of 27.8%. In addition, the new insurance was guaranteed to age 120.