By: Bill Clark | Senior Director

In a world where unsuspecting seniors navigate financial decisions, it's easy to feel like every day is April Fool's Day. Take June, an 84-year-old widow, for example. After her husband, Frank, passed away from a long battle with heart disease, June found herself in an assisted living facility, burdened by mounting medical bills. While knitting a baby blanket for her new great-granddaughter one afternoon, a captivating commercial flickered across her TV screen, promising relief from her financial worries. It touted the option of selling her life insurance policy for cash through something called a life settlement. Intrigued, she set aside her knitting and jotted down the contact information.

As June pondered the possibility, she realized she no longer had a pressing need for the policy. Her children were grown and financially stable, yet she was still shelling out hefty premiums to maintain coverage. "Why not explore this further?" she thought. With a simple phone call to the number from the commercial, June received a cash offer of $75,000 in less than 48 hours—three times greater than the $25,000 cash surrender value of her policy.

The offer seemed almost too good to be true, stirring both excitement and unease within June. She felt pressured to make a quick decision and was unfamiliar with the company pushing the deal. Was she being targeted by yet another financial scam aimed at unsuspecting seniors?

Seeking clarity, June turned to her trusted advisor, Michael, who assured her it wasn't a scam but urged caution. He explained that many direct-to-consumer marketers aim to purchase policies at a steep discount, prioritizing their own interests over the seller's. Instead, Michael suggested consulting a life settlement broker with a fiduciary duty to secure the best deal for June.

Enter Ashar Group, a reputable firm specializing in appraising life insurance assets and facilitating life settlements. With Michael's guidance and Ashar Group's expertise, June embarked on a journey to maximize the value of her policy. Together, they compiled compelling information to present through the policy auction, where multiple buyers would compete for the opportunity to purchase her policy. Just like in a real estate bidding war, this competitive environment drove up the value of June's policy.

Though the process took longer than the initial 48 hours, June felt no pressure to rush, and the outcome was beyond her wildest expectations. The auction yielded 14 separate bids, with the winning offer coming in at a staggering 19 times higher than the cash surrender value. What's more, the winning bid came from the very same buyer who had initially offered her only three times the cash surrender value. The key to this remarkable outcome? The competition created by the auction process, coupled with thorough underwriting, uncovered the true value of June's policy.

Ashar Group is a nationally licensed life settlement firm that protects 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, manage assets, or purchase policies. We are an independent resource for fiduciary advisors and their clients specializing in life insurance valuation for planning purposes.

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.

Challenges Faced:

1. Underfunded Policy: The policy's cash value was dwindling, jeopardizing its ability to meet the intended objectives within the estate plan.
2. Escalating Premiums: The client was grappling with the burden of escalating premiums, causing financial stress.

Solution Implemented:

1. 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.
2. 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.

Results Achieved:

1. Optimized Value: The life settlement process resulted in the client receiving a higher cash value for the policy than its current surrender value.
2. 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.