VIATICAL
SETTLEMENTS
A viatical settlement is, simply, cash paid
to a terminally or chronically ill person in exchange for his or
her life insurance policy's death benefits. The seller transfers
all policy ownership rights and obligations to the buyer in
exchange for a percentage of the policy's face value.
In short, a life insurance policy is an
asset that the insured has the right to sell. It is important to
note, however, that once a life insurance policy is sold, the
original beneficiaries will not be entitled to any proceeds upon
the insured's demise. If this is a concern, a partial sale of
the policy should be explored. MORE TOPICS IN: Insurance
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