Life settlements generally work best for people who are in their retirement years or meet certain criteria that make purchase of the life insurance policy attractive to the buyers. In general, the people who benefit most from life settlements include:

      * Individuals who have held a particular life insurance policy for a number of years and can now find life insurance coverage at a lower price elsewhere. In fact, over a third of all life settlements fall into this category. If you have been carrying a life policy for forty years, chances are you can sell this for a life settlement and find a better policy elsewhere for a reduced premium.

      * Individuals retiring from a high-profile position with a corporation. Many executives have huge policies on themselves because of their importance within an organization. On retirement, selling the policy and investing or using the proceeds for a comfortable retirement may be a wise option.

      * If the beneficiary of the original policy has passed away or reached his or her majority, a sizable life insurance policy may no longer be needed. This is sometimes the case for older Americans who originally purchased large policies when their children were young. If the children are now grown and on their own with a comfortable living, there is no longer a need to keep paying large premiums for a hefty policy.

      * Individuals who have large policies but can no longer afford the premiums can doubly benefit from the cash value of life settlements - they no longer have to pay the premiums and they receive a lump sum of money which they can use for other needs.

      * Individuals with terminal illnesses may benefit from life settlements while they are still living as a way to obtain much needed cash for medical treatments, hospice care and other expenses.

Life Settlements are Relatively Simple

There are an increasing number of brokers who handle life settlements today, and if you work with a financial advisor he or she can usually arrange a life settlement sale for you as well. The process is surprisingly simple. Because more and more people are going this route, tables have been designed that can give consumers an estimated range of what they can expect to get from a life settlement base on a number of criteria, including:

      * Age, sex and occupation of the policyholder

      * Health of the policyholder

      * Size of the policy

      * Annual premium rate of the policy

      * Final value of the policy upon policyholder's death

Most of this information can be easily obtained except for your health information. For this, you may have to agree to have your medical records for a specified period of time released to the life settlement appraiser. You may also be asked to undergo a complete physical.

After this has been done, you will generally receive several life settlement offers. It is this competitive bidding that gives you a sizable lump sum for your policy that far exceeds the cash value you would get from your insurance company.

To find out more, talk to firm specializing in life settlements or your financial advisor. As you enter your retirement years, a life settlement can give you a lot more options than you had thought possible.

Tony King