I’m 27 y/o- can I sell my life insurance policy?

[nlr1]

Hey everyone. I’m 27 and I have a whole life insurance policy that I bought and have been paying monthly premiums since I was 23.

For a number of reasons, I have no interest in keeping this policy. I saw there are several ways to sell a life insurance. Am I able to do so even though I’m only 27? I don’t care if I get less than face value due to brokers/advisors commissions etc.

Any info would be great!

 

[caspiansails]

@nlr1 Generally nobody would want to buy your life insurance unless there's likely to be a relatively soon payout, more specifically in the case of what's known as a viatical settlement. People who have something like terminal cancer will sell their policy for some amount of the face value in order to have access to it sooner and usually pay for medical bills. My understanding as to why this happens is to prevent the policy's insured from accruing medical debt and due to the short timespan the company is fine with the deal because any premium they pay combined with how much they paid for the contract is offset by the actual payout when the insured passes.

I'm guessing this doesn't apply to your situation, so here are your options:
1) continue paying on the contract until you no longer owe anything
2) stop paying and let the policy lapse (objectively worst option)
3) take your cash surrender value
4) stop paying and tell your agent you want to turn your policy into what's called a reduced paid-up policy; you don't owe anything more but the death benefit goes way down

Before you choose your course of action, just ask yourself why you want to cancel the policy. Need money now? Surrender might make sense. Just flat out don't like it or understand why you have it? Might want to dig a little deeper into the reasoning behind why you got it in the first place.

 

[nlr1]

@caspiansails This is really helpful thank you! I’m looking for money now and have no interest in the policy, so from what your saying it sounds like the cash surrender value is my best bet.

 

[chess123mate]

@nlr1 Cash surrender value is often 1/2 of CV and normally for any SV on WL policy you need a min of 5 y. If you lapse, there will be nothing. Selling for apparent CV is best option. However a detailed analysis needs to be done. In particular....what type of WL. Paidup additions? Whole life pay or 20 pay, ins amount.... etc.. company, non-guaranteed dividends projected pay out? Feel free to reach out for a more detailed conversation.

 

[reana]

@nlr1 You can probably cash it out for whatever it's worth.

 

[nlr1]

@reana Is this the same as the cash surrender value?

 

[reana]

@nlr1 Yes.

 

[tinamichelle]

@nlr1 Why would you want to cancel it?