In a time where receiving a higher payout with a life settlement could make the difference between accepting or delaying a needed medical procedure, far too many seniors are unaware of this option and instead surrender their policies or let them lapse. This fact is supported by the Insurance Studies Institute who discovered that 90% of the seniors who did let their life insurance policy lapse would have considered a life settlement had they known that receiving higher payouts was an option.
It’s also important for seniors to understand the difference between the primary insurance market and the secondary market. The primary market is where you would buy your initial policy, but it is not the place to give it back. Surrendering a policy back to the business entity (primary market) who wrote your policy would mean receiving a value far lower than fair market value. This is an important distinction. Typically, a Secondary Market Specialist can sell your policy to an institutional investor at a far higher price than the cash surrender value paid by the insurer. And when following best practices like any good Secondary Market Specialist would, it really is a good deal for all parties involved:
- The seller of the policy gets much more value out of their policy then surrendering it, infusing their budget with much needed income to pay off necessities like rising medical expenses
- The buyer of the policy obtains a deal that will pay them a death benefit sometime in the future
- The insurance company still collects premiums, only now from the buyer (new owner)
When selling the policy, a reputable Life Settlement Broker receives multiple bids from companies who would like to purchase the policy. The broker then leverages these bids to drive competition and obtain the fair market value of the policy for your client. Under the right circumstances, determining the fair market value of a life insurance policy can be a significant event, providing valued income for the original policyholder.
Go to https://ashargroup.com/policy-value-questionnaire/ to take the first steps in determining if a policy may qualify for a life settlement. It only takes a minute, and it could help save your clients thousands.
As nationally recognize Secondary Market Broker with over 15 years of experience in this unique and evolving sector, Ashar helps clients appraise, negotiate and monetize their life insurance and annuity assets to get a fair market value and an influx of income that typically exceeds expectations. Our objective is to protect the interests of our clients throughout the settlement process with the utmost care and professionalism.
To accomplish this goal consistently, with compassion and without compromising our advisors' reputations or time, we follow a strict set of standards and leverage our extensive experience to gain and maintain a high level of trust:
- Preferred industry status. Because of our professional approach and proven track record for nearly two decades, Ashar enjoys preferred status with institutional funding partners, advisors and industry experts. Our attention to details, commitment to compliance and passion for ensuring the best case scenario for our clients has propelled us among the top Secondary Market Brokers.
- Protected Advisor and Client Experience. We are an advocate to the advisor's world. We know that in order to preserve the advisors relationship with the client, our role is to support the advisor so they can serve the best interest of their clients. It is this insight that propels us to create smarter, simpler solutions and deep support for the advisors we serve.
- Perceptive Insights into the Secondary Market. The secondary market is evolving constantly, and Ashar’s experience and involvement in this crucial market positions us to better serve advisors and their clients in the coming decades. This knowledge combined with our preferred status within the industry and our unique offerings enable us to deliver consistent and trustworthy results to our clients.
We want to make it easy for advisors to learn about the Secondary Market, so you can help your clients make the best decisions while preserving and protecting their dignity and lifestyle. We invite you to talk to a Secondary Market Specialist at 800-384-8080 or visit ashargroup.com for more information on this emerging market.
An overwhelming number of life insurance policies are lapsed or surrendered everyday without the policy owner first checking for hidden value on the secondary market. A lapsed policy can be devastating to a senior citizen on a fixed income who could have used the policy money to manage long-term health costs or other immediate expenses.
If your client still have a policy and wants to keep all or part of it, here are some points to remember:
- If the policy has become unaffordable consider a split death benefit life settlement. This allows the policy owner to retain a portion of the death benefit with no future premium payments.
- If your client is thinking about dropping coverage, make sure to get it appraised. An appraisal can uncover “found money” that can be applied to other financial planning needs.
- It’s better for your client to sell their policy than to let it lapse. If the policy is no longer need or is underperforming, get a secondary opinion® to determine fair market value. That way you can determine if you can do better with a life settlement.
If you are thinking about a life settlement, talk to the experts as The Ashar Group. Our unparalleled staff of professionals combines years of experience in the Life Settlement market. We are committed to attending to the needs and welfare of each individual client. And we pride ourselves on integrity and the ability to identify the viability of a potential case quickly.
Talk to a Secondary Market Specialist at 800-384-8080 or visit ashargroup.com for more information on this emerging market.
There are many reasons why a business might purchase a life insurance policy, but often the life insurance as an asset angle is overlooked when it is time to retire and sell the business. Whether it is for investment purposes, to minimize the costs associated with risk management or for the benefits of employees, these policies have their benefits for a particular business during its lifetime. But when business owners are ready to retire, these polices may no longer be needed. Because of this, these policies are often overlooked as an asset that has great value, and are simply allowed to lapse. Checking the fair market value for these policies on the secondary market can uncover a level of liquidity that can add a significant amount to the value of a business, even accelerating the sale of a company for a desirable price and on more favorable terms.
A good case example is the one shown below of a business owner retiring. He hired a Business Exit Planner to help him sell his business to a private equity firm. The business included a key person policy designed to protect the firm from financial loss due to the death of a key executive. This policy was not included in the valuation of the business, and the private equity firm buying the business had no interest in the policy. The Exit Planner therefore negotiated release of the policy to the seller:
- The business sold for $28 Million
- The 76-year-old seller retained the $10 Million entity-owned insurance policy
- He sold it in the secondary market for life insurance for a lump sum of $800,000
Visit www.ashargroup.com for more case studies regarding life settlements well as other pertinent information regarding all aspects of the Secondary Market.
For a high number of seniors, the sad truth is that most will let their policies lapse instead of exploring a life settlement: which means no death benefit will ever be paid out. And according to the Insurance Studies Institute, 90% of these seniors would have considered a life settlement had they been aware of this option in the first place.
Yet many insurance agents are experience difficulty keeping up-to-date about the opportunities a life settlement may present. Some are even prohibited by their carrier or broker dealer to even have to discuss the subject of a life settlement with their clients in the first place. In situations where advisors have a fiduciary responsibility to their clients, this prohibition puts these planners in a position where they are literally handcuffed when it comes to meeting their fiduciary responsibility to their clients.
According to a life settlement study by the U.S. Government Accountability Office going back to 2010 and based on over 1,000 life settlement transactions, it found that seniors selling their policies in a life settlement transaction received almost 8 times as much money as the would have if they had surrendered their policy to the insurance company.
As a planner or fiduciary who has a client anticipating lapsing or surrendering a life insurance policy, it is to your advantage to get a secondary opinion® with The Ashar Group to see if you can do better with a life settlement. We are a team of highly skilled experts who work on behalf of financial advisors, trustees and other financial practitioners to find, negotiate and secure the true market valuation for life insurance policies in the secondary market.
Take a quick value policy quiz: https://ashargroup.com/quiz. It can help you determine if your policy can make more in the secondary market.
In a client-advisor relationship, the advisor is at an advantage, which is why it’s an advisor’s fiduciary responsibility to act in good faith for the client’s benefit. And this is more than the right thing to do; in many situations it’s the law. For example, according to The Employee Retirement Income Security Act of 1974 (ERISA): “A fiduciary shall discharge his duties with respect to a plan solely in the interest of the participants and beneficiaries “ (section 404 of ERISA)
With the advent of Life Settlements and the noticeably high hidden value they may contain, Consulting with a Secondary Market Specialist like The Ashar Group can provide a much needed source of revenue for a client, which is why no stone should be unturned to find the fair market price of a policy. If an executor fails to protect the estate’s assets the beneficiaries may have legal recourse to sue the advisor. And even if it even if legal action isn’t taken, the damage to a reputation could have serious consequences.
Life Settlements offer many options, and they are why advisors recommend to their senior clients who are looking for a way to enhance their retirement income to consider looking into the secondary market for a life settlement payout. For more information, talk to a Secondary Market Specialist at 800-384-8080 or visit ashargroup.com for more information.
Many changes can happen to seniors as they get older, which is why the ability to provide them with the services and support for those you love. Here are some links that you may find helpful as you deal with senior care and all the financial and emotional complexities that come with it. For a full list of recommended sites, please visit ashargrop.com.
AARP - American Association of Retired People:
The AARP website contains unlimited resources to help with retirement needs and healthcare planning. Research all the options available and hear from others on how today’s economy and events are impacting them. The AARP's retirement planning page: click here.
Society of Financial Services Professionals:
Society members can offer seniors and those who are providing their care expert assistance with: estate, retirement and financial planning; business and compensation planning as well as insurance for life, health, disability, and long-term care.
The Assisted Living Federation of America (ALFA)
The Assisted Living Federation of America (ALFA) is the largest national association exclusively dedicated to professionally-managed, resident-centered senior living communities and the seniors and families they serve. Their mission is to be a voice for choice, accessibility, independence, dignity, and quality of life for all seniors. For additional information, visit alfa.org.
The Alzheimer's Association
The Alzheimer's Association advances research to end Alzheimer's and dementia while enhancing care for those living with the disease. Learn more at allz.org.
The National Parkinson Foundation (NPF)
For over half a century, the National Parkinson Foundation (NPF) has focused on meeting the needs in the care and treatment of people with Parkinson’s disease (PD). NPF has funded more than $182 million in care, research and support services. Learn more about Parkinson's disease.www.parkinson.org.
If you are in a position where you think it would be prudent to consider additional alternatives like a Life Settlement, talk to a secondary advisor. You can also go to https://ashargroup.com/policy-value-questionnaire/ to take the first steps in determining if a policy may qualify.
The possibilities of utilizing a SMV®, or Secondary Market Valuation, are many. If you are considering a Life Settlement, here are some important considerations:
• Make sure to work with a reputable Life Settlement Broker that will always have best interests of your client in mind. They will be will put your policy through a competitive bid process to ensure your client get the most for the policy.
• Consider the life settlement options. For example, Ashar offers a variety of alternatives when deciding on a life settlement: With the Lump Sum Settlement, the policy owner would sell the insurance policy that is no longer needed or affordable on the Secondary Market for more than cash value. With Term Transformer, a client can turn a term policy that is no longer effective for the policyholder or is about to expire into a cash settlement. And with Ashar's Split Death Benefit Option, the policyholder truly does have the best of both worlds. The policy owner retains a percentage of the death benefit while the buyer takes over the premium payments enabling the original policy owner to retain some coverage with no future premium payments on their part.
• Do it for the right reasons. Some reasons are better than others for choosing a life settlement. One easy way to determine if a life settlement is your best option is by going to www.ashargroup.com/quiz/start to see if you qualify. Besides reasons like funding long term care or reducing or elimination premiums, other compelling reasons include:
* Determining the value of a policy for a recent merger or acquisition
* A change or transfer in business when a policy can be valued as a significant asset
* Funding a project by generating liquidity
Policy owners now have more options and control than ever before thanks to the secondary market for life settlements, which has allowed policy holders to put a value on what may be their largest asset. In fact, it’s no different than putting a value on a house on the open market.
And just like the transaction process with a house, the process for determining Fair Market Value (FMV) is very similar. Legislation has changed to protect the rights of the policy holders so they can sell their policies for the most competitive bid. This legislation also includes the right to be informed about the opportunities presented by the market and the right to privacy throughout the transaction. These factors in in turn have helped open up the market, while piquing the interest of the policy holder’s advisor to determine a FMV in the secondary market.
A SMV®, or Secondary Market Valuation is determined by numerous factors. Of all the factors that are taken into consideration, the one that trumps all others is the life expectancy of the insured, which is what the actuary will use when estimating the valuation of the policy. Typically life settlements are offered to seniors’ age 65 and older with a life expectancy of 15 years or less in most cases. When the cost of premiums is very low, then there are some offers being made for life expectancies greater than 15 years.
The results of the Secondary Market Valuation is also determined by the type of policy owned, whether that’s universal life, whole life and even a convertible term policy all can benefit. Investors choose universal life policies for example, largely due to the flexibility in premium payments.
The bottom line is that a life settlement broker is needed to secure fair market value by creating an environment that encourages a competitive bidding process. An SMV®, or Secondary Market Valuation, incorporates the impact of obtaining a variety of competitive bids from a multitude of prospective institutional buyers to ensure that the highest value possible is obtained. An experienced life settlement broker has the knowledge and experience to help make this happen.
If you are in a position where you think it would be prudent to consider alternatives, talk to a secondary advisor. You can also go to
https://ashargroup.com/policy-value-questionnaire/ to take the first steps in determining if a policy may qualify for a life settlement.
Before the Secondary Market emerged, advisors and policy owners had few options when surrendering or lapsing a policy, which is why we came up with the idea of 5 best practices to protect your client and yourself. With more options and advantages available in the Secondary Market, advisors can offer their clients the potential for larger settlements and the possibilities to offset tax obligations. With these opportunities also comes the responsibility of advisors to know when the secondary market can be advantageous for a client, and this is where a Secondary Market Specialist comes in. These specialists are able to identify the potential for a policy to be sold on the secondary market, generating a settlement which can enrich the life of the policyholder and ensure the advisor did their due diligence for their client. Here are a few examples of how a Secondary Market Specialist can help traditional advisors and their clients:
- Offset estate tax obligations with life insurance – With the passing of the American Taxpayer Relief Act of 2012 (ATRA) estate tax exclusions were raised. This can cause a reduction in a client’s estate tax liability, which in turn can reduce the amount of policy coverage needed and frees up liquidity for other uses
- Convert a term policy into a cash settlement – The Term Transformer offers an alternative to liquidate a policy. It’s designed for a convertible Term Life Policy that is about to be surrendered or about to lapse
- Limiting liability for exit planning – Determining fair market value of a life insurance policy may be worth more than the business, generating significant value for a client for exit-planning or transferring business
- Eliminate premiums without surrendering policy – A Split Death Benefit Option from Ashar gives policyholders the opportunity to eliminate premium while maintaining some coverage with no future premium payments (a percentage of death benefit goes to policy owner while a buyer takes over premium payments.)
- Analyze likelihood of a policy flush in hidden value in the Secondary Market – Determining Fair Market Value (FMV) can significantly enhance the lifestyle of a client and minimize the risk of a lawsuit against advisor for negligence
If you are in a position where you think it would be prudent to consider alternatives, talk to a secondary advisor. You can also go to https://ashargroup.com/policy-value-questionnaire/ to take the first steps in determining if a policy may qualify for a life settlement. It only takes a minute, and it could help save your clients thousands.
