Understanding eligibility before a policy lapses can help
clients unlock meaningful value and give advisors an
additional planning solution.
Highest Likelihood: UL / GUL / VUL Policies
Universal Life policies (including Guaranteed UL and Variable UL) are often the strongest candidates for life settlements. These policies frequently carry significant premiums and may be surrendered for little or no cash value, despite having real secondary market value.
Possible: Convertible Term Policies
In some cases, term policies can qualify for a life settlement if they are still within the conversion period. This can allow clients to recover value from a policy that might otherwise expire with no return.
Least Likely: Whole Life Policies
Whole life policies are typically less likely to qualify for life settlements. However, every case is different, and policies may still be worth reviewing depending on structure and client needs.
A Quick Eligibility Checklist
Step 1
Client is typically age 65 or older
Step 2
Policy face amount is generally $100,000+
Step 3
Policy type is UL, GUL, VUL, or convertible term
Step 4
Premiums no longer make sense
Step 5
Client’s health may have changed since issue
Want to See if a Policy Qualifies?
If you have a policy in mind, Abacus Life can provide a fast, no-cost review. You can also use our calculator to get a preliminary estimate.
