For 16 years, we have written about Life Settlements and what a great alternative this transaction could be for seniors about to lapse or surrender a policy. And, as you can’t help but notice, in the last few years, ads for Life Settlements are all over television, radio and social media as more firms want “in on the action.”

Despite this increased visibility, there are relatively few transactions done each year. Why are so many policies still being lapsed or surrendered before determining if they could have yielded additional value on the secondary market? Perhaps it’s because advisors aren’t focused on in force policies, especially on older people. 

This lack of attention could become an issue as according to the SEC’s Fiduciary Interpretation “An investment adviser must, at all times, serve the best interest of its client and not subordinate its client’s interest to its own.”

What happens when policyholders or their families realize, too late, that they weren’t made aware that they might have received much more than the policy’s cash value and are upset because their advisor did not suggest trying to sell their policy?  Sooner or later, it seems likely there will be litigation. Think of all the baby boomers that have policies that haven’t been reviewed since they were purchased, and how many of these policies will “blow up” due to changing interest rates and mortality charges. Additionally, how many policyholders’ needs or financial circumstances have changed since they first bought the policy?

To make it easy for you to contact your senior clients, we have a sample letter available that you can send out, making them aware of the life settlement option, but also pointing out that their life insurance policy could be the most valuable asset in their portfolio. Also to accompany the letter, we have a pamphlet available, “Life Settlements: Uncovering Hidden Value in Your Life Insurance Policy.”

Sending a letter or email is a relatively painless way to follow up with your senior clients whose objectives and resources might have changed, and it helps you to satisfy your ethical and fiduciary responsibilities.

Finally, after all the years of asking people for money to pay premiums on their insurance, a Life Settlement could be a great way to get them money. And – from lots of experience, getting people money is a big win-win: not only do you make them happy when selling their policy, but you earn money too.

As we always say, “it can’t hurt to try – it can only hurt not to.” This time, we add, it can’t hurt to ask for our sample letter – it can only hurt not to!