What do you do when a friend is stricken with a serious illness and comes to you for help? Your first reaction is likely to be emotional--shock, grief, despair. These reactions are only natural. But your friend will be looking to you for more than sympathy. Your friend will need your help.

Now there is a new law that can provide financial relief to individuals and families at a time they may need it most.

Effective January 1, 1997, Congress enacted The Health Insurance Portability and Accountability Act of 1996, which allows individuals with a terminal or chronic illness to sell their life insurance policies (or even part of a policy) to a third party. The funds the individual receives would be free of federal taxation. There are no restrictions on the use of the funds received. The money can be used to pay medical bills or other health care costs, or for such things as taking a dream vacation or funding a new business for a loved one.

The process of selling an insurance policy to a third party is known as a "Viatical Settlement or life settlement" and the third party companies who buy the life insurance policies are known as "Viatical Settlement / Life Settlement Companies," or "Viatical Settlement / Life Settlement Providers." The word "viatical," coined by a financial planner, has its root in the Latin word "viaticum," which applied to the practice of supplying soldiers with provisions for their long journeys.

How does a Viatical Settlement / Life Settlement work? First, an application is submitted to a Viatical Settlement / Life Settlement Broker, and the individual's medical records are reviewed on a confidential basis. A Viatical Settlement / Life Settlement Company then gives a quote which the individual can accept or reject. Quotes can be for as high as 85% of the policy's face value, depending on the insured's life expectancy, prevailing interest rates, and future premium payment obligations of the policy. If the applicant accepts the quote, the money is placed in escrow for at least fifteen days to give the applicant additional time to cancel the transaction. Once the time period runs and the money is transferred into the applicant's account, the Viatical Settlement Company becomes the owner of the policy, appoints itself beneficiary of the death benefit, and assumes the obligation of making the policy's premium payments from that point forward.

Feel free to contact us anytime for a free no-risk consultation toll-free at (877) 836-4661 or email us if you have any questions.