Considering the financial landscapes many clients are navigating, here's an everyday success story that underscores the importance of valuing assets, particularly life insurance, in crafting comprehensive planning solutions.
We recently worked with a client facing the challenge of an underfunded life insurance policy held within an Irrevocable Life Insurance Trust (ILIT). The policy, once thought to be a cornerstone of their estate plan, was underperforming and had become a source of financial strain due to rising premiums.
- Underfunded Policy: The policy's cash value was dwindling, jeopardizing its ability to meet the intended objectives within the estate plan.
- Escalating Premiums: The client was grappling with the burden of escalating premiums, causing financial stress.
- Thorough Evaluation: We conducted a comprehensive evaluation of the policy, considering its current cash value, performance, and alignment with the client's evolving financial goals.
- Life Settlement Exploration: Recognizing the need for a strategic solution, we explored the option of a life settlement. This involved engaging an independent life settlement seller's representative to facilitate a competitive policy auction.
- Optimized Value: The life settlement process resulted in the client receiving a higher cash value for the policy than its current surrender value.
- Financial Relief: By selling the policy, the client not only achieved liquidity but also alleviated the burden of future premium payments.
Impact on Comprehensive Planning: The funds from the life settlement were strategically reinvested, contributing to a more robust and diversified financial portfolio. This, in turn, allowed for the reevaluation and adjustment of the client's overall estate planning strategy.
This success story highlights the transformative impact of valuing and strategically managing life insurance assets within the context of comprehensive financial planning.
To find out if your client's policy may qualify for a life settlement, try our probability calculator.
Ashar Group is a nationally licensed life settlement firm representing the best interests of policy owners by creating a competitive policy auction to deliver the best value to the seller. Ashar Group does not sell life insurance, management assets, or purchase policies. We are an independent resource for fiduciary advisors and their clients specializing in life insurance valuation for planning purposes. Contact us today.