Required

Do Not Just Stop Paying Life Insurance Premiums

Most people purchase life insurance for specific reasons. The most common reason to get a life insurance policy is to make sure that a spouse or other family members have financial support after the policy-holder passes away.

However, if a spouse predeceases the policy holder or if the other family members are no longer in need of support, then many people think that continuing to pay the premiums is a waste of money. Consequently, they believe the money is better spent on other things.

One problem with that thinking is this: all of the money that was paid in premiums is wasted.

The New York Times recently reported on another potential problem with stopping premium payments in “Wringing Cash From Life Insurance.”

Older Americans can often get cash by selling their life insurance policies to life settlement companies that see the policies as good investments.

The settlement company continues to pay the premium and then receives the payout when the original policy holder passes away.

For a life settlement company to see the policy as a good investment opportunity, they have to take a gamble that the policy holder will pass away sooner rather than later. Therefore, the older and sicker an insured is, the more money he or she is likely to get when selling a life insurance policy.

While it might seem somewhat morbid to sell your life insurance policy to a company calculating you will not live very much longer, it can be a good way for older people who need extra money to get it.

Reference: New York Times (Oct. 13, 2017) “Wringing Cash From Life Insurance.”

Hear From Our Clients
tes-prev
tes-next

I heard Cindy’s presentation at a Senior Luncheon at my church, and was very impressed. She helped my daughter and me understand many aspects of elder law. Josh has also been very helpful in my planning to enter an independent living situation . I have told many friends about them.

- Charlotte

The very best elder law attorney and staff anyone could ever ask for! I have referred a number of clients to Cindy and she never disappoints. She is kind, caring, and extremely thorough in making sure everything is completed as it should be. I highly recommend Cindy for anyone needing lawyer services; she truly goes above and beyond for every client she helps and has had a huge impact in so many peoples’ lives. Thank you, Cindy and staff, for everything that you do- I’m so glad to know you!

- Kerri

Cindy and the Nelson Elder Care Law team are trustworthy and helpful. They are the experts in elder care law. At Leaf Cremation, we entrust our families to the care of the Nelson team when their services are needed.

- Pierce

Josh Nelson, and his staff, have been amazingly helpful to our family. The ins and outs of nursing homes, the rules and regulations that govern Medicare and Medicaid are daunting and the folks at Nelson Elder Care Law have been informative, responsive, and above all, empathetic. I cannot emphasize enough how their service has taken a weight off of our shoulders especially during a world pandemic that has targeted nursing homes across our country. I highly recommend retaining Josh and his firm!

- Marcia

I had a simple legal question to them that I needed answered and they very helpful in giving me the information I needed. I highly recommend them and will reach out to them if I need more advice or assistance. Thank you for taking your time to just answer a couple of questions I had!

- Ben