| Life settlements are relatively new, so it is | | | | broker. He then takes a percentage of that |
| important to find a broker who understands the | | | | amount. This encourages him to get the largest |
| market, has enough drive to negotiate the best | | | | settlement possible to increase his own earnings |
| deal on your behalf and compassionate enough to | | | | while protecting your own. |
| guide you through what might be an emotional | | | | Industry Contacts - The contacts of your broker |
| process. | | | | should be large-scale institutions and competitive |
| A life settlement is a sum paid for a life insurance | | | | bidders. There is still a great deal of fraud in the |
| policy no longer necessary or desired. The value | | | | insurance industry, so your broker should be |
| of the settlement is negotiated, and most | | | | working with those who already know how to |
| settlements are up to three times the value of | | | | identify and avoid fraudulent activity. Your broker |
| simply surrendering the policy. The right broker will | | | | should also know some of the highest bidders in |
| be able to answer your questions and be | | | | the industry to be sure you are getting the most |
| knowledgeable and skilled enough to get the most | | | | value for your policy. |
| for your policy. | | | | Medical Contacts - A medical professional on the |
| Consider the following when finding the broker to | | | | staff or associated with a broker's firm can also |
| meet your needs. | | | | work to your advantage. A doctor working with |
| The Information Provided - The broker should be | | | | your broker can help interpret your medical |
| educating you and keeping you up to date on all | | | | history in an advantageous way. This can mean a |
| aspects of the settlement. He should be upfront | | | | difference financially. |
| about his own affiliations and actions. There is | | | | Protecting Your Interests - The National |
| nothing for a broker to hide in a settlement, so he | | | | Association of Insurance Commissioners (NAIC) |
| should be open and always willing to explain or | | | | helps regulate the insurance industry by setting |
| answer questions. | | | | standards of conduct on the part of brokers and |
| The Fee Structure - Brokers are paid in one of | | | | insurance professionals. You should also ask to |
| three ways. They may take a percentage of the | | | | see the broker's E&O insurance (Errors and |
| insurance's face value. This means they get the | | | | Omission insurance). This insurance is unavailable to |
| same amount regardless of the settled price. | | | | brokers who have a history of fraud or unethical |
| They might get a percentage of the negotiated | | | | behavior. Brokers without E&O insurance should |
| price. This encourages the broker to get the | | | | be avoided. |
| highest price possible, but can also significantly eat | | | | A life insurance settlement also means disclosing |
| into your benefits. | | | | your personal and medical information to your |
| A final, and perhaps fairest, method of payment | | | | broker. Be sure to read and understand the |
| is for the broker to take a percentage of the | | | | broker's privacy policy to best protect your |
| value gained. The settled amount less the | | | | interests. |
| surrender value is the benefit gained by the | | | | |