5 Reasons Not to Get Your First Life Settlement Quote From Coventry Direct 

Rebecca Parson
Rebecca Parson

Rebecca Parson

Author

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 money.com, sacbee.com, cart.com, herodevs.com, blanchardgold.com, and more.

Brian OConnel
Brian OConnel

Brian O'Connel

Contributor

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, TheStreet.com, Yahoo Finance, CBS Marketwatch, and many more.

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

At Beca Life, we’ve been in life insurance for 16 years. In that time, we’ve gotten a lot of questions about Coventry Direct. Many seniors have seen their ads on TV, so it makes sense.

One frequent question we hear is, “Should I get a quote from Coventry first? It couldn’t hurt, right?” 

While it might seem harmless to get a preliminary quote from Coventry Direct for your life insurance policy, there are several reasons why this approach could actually be disadvantageous. We explore them below.

1. Market Position and Initial Offers

Coventry Direct, known for its large presence in the life settlement market, often entices policyholders with the simplicity of direct offers. But these initial offers may not always represent the best value for your policy. The process of selling your life insurance, much like any valuable asset, benefits significantly from multiple quotes so you receive the highest bid.

2. Impact on Brokers’ Willingness to Engage

Once you get a quote from Coventry, you might unintentionally limit your options. 

Life settlement brokers, who play a crucial role in getting you competitive bids, may be less inclined to take on your case if they know Coventry has already made an offer. This is because brokers invest considerable effort and resources in assembling a comprehensive case — including medical records requests, insurance company requests, and expensive life expectancy reports. 

It’s hard for a broker to compete against a buyer like Coventry who will not be paying a broker fee if they were contacted first. In that situation, many brokers won’t take the case. 

The motivation of a broker to market your policy after you received a bid from Coventry is not the same as when they are the first to take a look at your policy. The broker charges a fee that can amount to 20% to 30% of the sale proceeds. If Coventry does not pay the broker fee, they 

only have to bid 71% or 81% (1% more than the next best offer after the broker fee) of the next best offer for the seller to go with them.  

3. Broker’s Motivation and Resource Allocation

If you’ve already gone to Coventry, some brokers will take the case but only make a half-hearted effort to sell the policy, not investing the resources necessary to get you the best offer. 

There are a couple of ways a broker may know you’ve already gone to Coventry. First, the broker may require that you tell them about any other offers before they’ll decide to work with them. Second, the broker may be able to tell that Coventry has already done a medical records request on you. 

4. Restricted Negotiation Leverage

Coventry knows it’s the biggest fish in the pond, so to speak. So the company knows that if you engage with it first, it is hard to then start with a life settlement broker (in all likelihood). Knowing it’s the only bidder on your policy might lead Coventry to present a lower offer, anticipating minimal competition. 

By contrast, engaging with a life settlement broker encourages multiple offers, as buyers are motivated to outbid each other.

5. Market Dynamics and Selling Strategy

The process of selling a life insurance policy is complex and should ideally involve multiple potential life settlement buyers for you to get the best possible offer. 

The life settlement market operates differently from selling simpler assets, like cars or even a house, where you can fairly easily get and compare multiple offers. Each life insurance policy evaluation requires a bespoke approach based on the specific details of the policyholder’s health and the policy’s terms.

Should You Sell Your Life Insurance to Coventry Direct?

We’re not saying you shouldn’t sell your life insurance policy to Coventry Direct — just that you shouldn’t get your first offer from Coventry. The only exception would be if speed is more important to you than money. 

If you need the cash quickly and that’s more important than how much cash you get, you may want to go to Coventry first.

At Beca Life, we educate life insurance policyholders on a) whether to sell their life insurance and b) who to sell it to. Contact us now, and we’ll be happy to answer your questions. We’re the only company that can refer you to brokers and buyers. You can also call us anytime at (848) 456-8333.

FAQs

Is Coventry Direct a legitimate company?

Yes, Coventry Direct is legitimate and is not a scam.

What Percentage Does Coventry Direct Take?

Coventry Direct does not take a percentage as a broker fee, and they are also a licensed provider. 

Does Coventry Direct Pay The Most For Life Insurance Policies?

Coventry Direct has by far the largest share of the life settlement market. They pay top dollar for many policies when there are others bidding against them. For policies that they are not competing on, they have no incentive to pay more than the absolute minimum that a seller would agree to. 

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