One of the most common questions we hear at Lifestone is: "How much could I actually get for my policy?" The honest answer is that it depends on several factors. But understanding those factors can help you know roughly what to expect — and may reveal that your policy is worth considerably more than you think.
Factor 1 — The Face Value of Your Policy
The face value (also called the death benefit) is the amount your policy would pay out when you pass away. This is the starting point for calculating a life settlement offer.
Policies with higher face values generally receive larger offers. Most life settlement buyers look for policies with a face value of at least $100,000. Larger policies — $500,000 or more — often attract more competitive bidding from buyers, which can drive the offer price higher.
Factor 2 — Your Age
The older you are, the more your policy is typically worth in a life settlement. This may seem counterintuitive, but it reflects how the buyer thinks about the investment.
A buyer who purchases your policy takes over your premiums. The sooner the policy matures, the fewer premiums they have to pay — and the sooner they receive the death benefit.
Factor 3 — Your Current Health
A change in health since your policy was originally issued can significantly increase your offer. If your health has declined, your life expectancy has shortened — and that makes your policy more valuable to a buyer.
This is one of the most misunderstood aspects of life settlements. Many seniors assume that poor health disqualifies them or makes things complicated. In reality, it often works in their favor.
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Check My Policy ValueFactor 4 — The Type of Policy
Not all life insurance policies are equally attractive to buyers. Universal Life and Whole Life policies are the most common types purchased in life settlements because they are permanent policies with no expiration date.
Term life policies can also qualify — particularly convertible term policies that can be converted to permanent coverage. Variable Universal Life (VUL) and Indexed Universal Life (IUL) policies also frequently qualify.
Factor 5 — The Ongoing Premium Cost
The annual premium cost matters because the buyer will take over those payments after purchasing your policy. A policy with very high annual premiums is less attractive to buyers because it costs more to maintain. A policy with low or manageable premiums is more desirable and typically commands a better offer.
How to Get an Accurate Estimate
The only way to get an accurate, real-world estimate is through a policy review with a licensed life settlement specialist. At Lifestone, we review your policy at no cost and with no obligation, and we give you an honest assessment of what your policy might be worth on the current market.
Start your free policy review — it takes about 60 seconds.
Every policy is different, and every client's situation is unique. But understanding these five factors gives you a solid foundation for evaluating your options. The next step is simply starting the conversation.
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