Why Choose a Broker? It Pays to Know the Difference
The Life Settlement industry is still only vaguely understood among the general public. An important area to understand is how the Viatical/Life Settlement process works, specifically, the role of a Life Settlement Broker versus that of a Life Settlement Provider.
Life Settlement Broker represents the Insured/Policy Owner
If you or someone you know is interested in exploring the possibility of a Life Settlement, a good first step is to contact a Broker. A broker's fiduciary duty is to the Insured/Policy Owner.
Brokers, like Life Insurance Buyers, Inc. (LIBI), represent the individual(s) who wishes to sell their life insurance policy(s). This often starts with a simple phone call from the Insured/Policy Owner wanting to know whether they qualify or if their policy would qualify.
A broker aides in determining whether or not the policy would qualify and the potential Fair Market Value. It’s important to note there is NO obligation to go through with a Life Settlement simply because you’ve contacted a broker. At LIBI, we’re always happy to talk with clients who simply want more information about this alternative option.
A broker has access to and works with multiple providers in the marketplace and creates a competitive bidding environment to maximize the policy’s value. The broker makes a vast difference and working with an experienced broker, like LIBI, is a necessity if you want to ensure you’re getting the best possible offer for your policy.
Life Settlement Provider represents the Investor/Buyer
Just like the Insured/Policy Owner has a representative in a broker, a provider represents the investor who purchases the policy(s). Providers act as the purchaser in this transaction. Because individual investors rarely, if ever, purchase these policies, providers almost always work with institutional investors.
A provider’s fiduciary duty is to the investor they represent. That means, the provider is working to buy a policy for the least amount of money possible.
One thing to be aware of is that providers may offer Fair Value for the policy as opposed to Fair Market Value. This could lead to an acceptance for an offer that, while higher than the policy’s cash surrender value, is much lower than what someone could have received by working through a broker.
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From the first call to LIBI, each client only works with the owners, Greg and Lisa, who are there to help every step of the way.
Life Insurance Buyers, Inc. is a licensed Life Settlement Broker that acts as a fiduciary to protect the best interests of policy owners in the Life Settlement process by creating a competitive auction to deliver the best value to the seller/consumer. Life Insurance Buyers, Inc. is an independent seller’s representative and does not sell life insurance, manage assets, or purchase policies.