How to Determine the Best Company to Sell Your Life Insurance Policy To

Rebecca Parson
Rebecca Parson

Rebecca Parson


Rebecca Parson is a financial and tech writer with 10 years of experience writing about topics such as life insurance, commodities investing, and the SaaS industry. She has a master’s degree from Johns Hopkins University and a bachelor’s degree from the University of Mary Washington. Her writing has appeared at,,,,, and more.

Brian OConnel
Brian OConnel

Brian O'Connel


Brian O’Connell has been a contributing writer for U.S News & World Report since 2016. A former Wall Street bond trader and the author of two best-selling books; “The 401k Millionaire” and “CNBC’s Creating Wealth”, he has 20 years experience covering business news and trends, particularly in the business and financial sectors. He believes education is the best gift a financial consumer can receive – and brings that philosophy to every story he writes. His byline has appeared in dozens of top-tier national business publications, including CBS News, Bloomberg, Time, MSN Money, The Wall Street Journal, CNBC,, Yahoo Finance, CBS Marketwatch, and many more.

By Rebecca Parson, Brian O'Connel
Author, Contributor, Life Insurance

Key Takeaways

  • The highest offer is almost always the best offer.
  • Get multiple bids.
  • Ask for references.
  • Make sure the company hasn’t been sued — especially by seniors.

When trying to determine the best company to sell your life insurance policy to, focus on finding a buyer that offers the highest payout. This isn’t always the same company because different companies specialize in different situations and types of policies.

To choose from among companies that buy life insurance policies, the top priority should be finding the one that gives you the most money, acts ethically, and gives you options. It’s always a good idea to get multiple bids for your policy.

Who Buys and Sells Life Insurance Policies?

Direct life settlement companies typically buy from policyholders who are over 65 years old. In some cases — viatical settlements — younger individuals with terminal health issues will also be eligible to sell their policies.

In many cases, life settlements are grouped and held by institutional investors, such as hedge funds and insurance companies. Individual investors rarely invest in life settlements.

Buyers are especially interested in universal life insurance because they can often pay fewer premiums in the early years by using an actuarial model called premium optimization. They are looking for policies with death benefits over $100,000 because it takes time and there is a lot of paperwork. Often it is not worth their time for policies under $100,000. In rare cases where the insured has a terminal illness, buyers will purchase policies if the insured is under 65 or the policy has a face value under $100,000.

How Are Life Settlement Brokers Paid?

Typically, brokers earn a commission of up to 30% of the sale proceeds. Life settlement brokers don’t buy insurance policies themselves. Instead, they act on behalf of you, the policy seller, and have a fiduciary duty to represent your interests in the transaction. Brokers are responsible for collecting your medical records, organizing your insurance documents, and marketing your policy to potential buyers. This typically costs a broker at least $1,000.

A common concern among brokers is the risk of exposing your policy to a buyer who may bypass them and approach you directly with an offer. Additionally, some brokers don’t put enough effort into marketing your policy or don’t want to spend the necessary money ordering life expectancy reports if they think the offer will not be that high. 

This is why choosing brokers with references and a track record of honesty is important.

How Are Life Settlement Providers Paid?

life settlement provider makes money by facilitating the sale of a life insurance policy. A provider or broker license is necessary to purchase a policy or even negotiate with a seller. 

How Life Settlements Work

You can sell your life insurance policy via a broker or directly to a buyer. Brokers get multiple bids on a policy to get the highest price, while a buyer will submit a bid with the advantage of eliminating any broker fees.

The process for selling your life insurance policy looks like this:

  1. Give your policy details.
  2. Grant access to your medical records.
  3. Give the broker/buyer some time to gather the necessary information.
  4. Get multiple offers (ideally).
  5. Sell your policy and receive a payment for it. 
  6. The buyer assumes all future premiums for your policy.
  7. Periodically, the buyer will check in with you to confirm your health status.

Consumer Alert for Life Settlements

To protect yourself from life settlement scams targeting seniors:

  • If someone contacts you wanting you to buy a policy and sell it right away, let your state insurance department know. This practice may be fraudulent and the relevant authorities may want to prosecute.
  • If someone solicits you, ignore them. Selling your life insurance should be a measured, careful process. Unscrupulous, fly-by-night operations may contact you with fast-cash offers, but it’s better to take your time, make sure they’re licensed, and get references.

8-Point Checklist for Finding the Best Company to Sell Your Life Insurance to

To determine the best company to sell your life insurance policy to, look for the following:

  1. Competitive Offers: Look for the highest offer. This is a financial transaction with huge implications for your family — the highest offer is almost always the best offer.
  2. Ethical Practices: Choose a company known for its ethical dealings. You can do this by looking it up on the Better Business Bureau’s website, and by asking for references you can contact for their direct, unfiltered opinion.
  3. Flexibility in Options: Find a company that provides various selling options, such as Beca Life. Beca is the only company that can direct you to vetted brokers and direct buyers.
  4. No Lawsuits: Verify that the company has no lawsuits filed against it, especially from seniors.
  5. Offers Beyond Cash: Consider companies that can offer alternatives like a reduced death benefit in addition to or in place of a cash offer.
  6. Regulatory Compliance: Make sure the provider or broker is licensed and in compliance with regulations by Googling “life settlement license lookup” to find your state agency lookup tool.
  7. Communication: The company should communicate with you throughout the process. Selling your policy can be stressful, and communication is key to making the process as stress-free as possible.
  8. Reliability: Choose a company that doesn’t back out after making an offer. If the company tries to walk back an offer or change the terms, we recommend looking elsewhere. 

Questions to Ask Yourself Before Selling Your Life Insurance

Before you get a life settlement, ask yourself some critical questions to be sure it’s the right choice:

  • Do I still need life insurance? If you can afford your premiums and your beneficiaries will need your death benefit after you die, it may be better not to sell.
  • Can I find other ways to pay my premiums? If you can’t afford your premiums but still want the policy, look into reducing your death benefit for lower premiums or getting a loan from your policy. Talk to the agent who sold you the policy. 
  • Are the buyer and broker trustworthy? Your broker and buyer should be licensed in your state and they shouldn’t rush you into a decision. If you get a bad feeling, trust your gut.


How Do You Determine the Fair Market Value of a Life Insurance Policy?

The fair market value is determined by putting a policy on the market, getting multiple offers, and seeing what the highest offer is. You can do this to price your life insurance policy and then decide whether or not you want to sell the policy.

What Companies Will Buy Your Life Insurance Policy?

There are dozens of companies that purchase policies on the secondary market. 

Sell your life insurance policy for cash.

See if you qualify now.

We’re here to help. Speak with a Policy Specialist today at +1 848-456-8333