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Did You Know You Can Sell Life Insurance You No Longer Need? Here Are the Pros and Cons

May 30, 2021

From the Money website

The term “life settlement” might sound arcane, but it actually describes something fairly straightforward: the sale of life insurance you no longer need or now can’t afford. While a settlement isn’t the right move for everyone, it allows you to get money for a policy so the funds can be put to other uses.

Conventional wisdom holds that there are only two options for unwanted or unaffordable permanent life insurance — that is, of the whole-life or universal types, which combine a death benefit with an investment component that has its own separate value. The policy can either be allowed to lapse or surrendered in exchange for the return of a portion of the money you invested in it.

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