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Kate Dore, a Candidate for CFP Certification, is an expert on debt, credit scores, banking products, mortgages, investing, income taxes, life and health insurance, estate planning, and student loans. Kate's work has appeared in outlets like Business Insider, Financial Planning magazine, MagnifyMoney, Credit Karma, and Simple Money magazine. She received her Certificate in Financial Planning from Belmont University.
Updated August 05, 2024 Fact checked by Fact checked by Betsy PetrickBetsy began her career in international finance and it has since grown into a comprehensive approach to journalism as she's been able to tap into that experience along with her time spent in academia and professional services.
As you get older, your life insurance policy becomes more costly. It even can become unaffordable, so it's easy to see why so many people give up their policies. A 2019 study from the Society of Actuaries and LIMRA found that 4% of life insurance policies—worth billions of dollars—lapse every single year. If you need money, there is an alternative you may not have considered: life settlements.
Whether you need cash for high medical bills, a divorce, or other living expenses, it may be possible to sell your life insurance policy to a life settlement provider. However, without federal regulation, it can be tough to know which companies to work with. To find the best life settlement providers, we compared 15 of the leading companies based on reputation, nationwide availability, customer service, sales process, and more. These are the four best life settlement companies the industry has to offer.
Coventry earned the top spot on our list because of its size and strong reputation. The company pioneered the life settlement industry by creating a secondary market for life insurance in 1998. It’s the country’s biggest life settlement provider by a large margin—accounting for 40% of all transactions in 2020. Coventry was named the number-one life settlement provider in 2020 by The Deal.
Pros & ConsCoventry conducted the first life settlement transaction and has become the industry’s biggest life settlement provider. The company’s size, long-standing reputation, and industry accolades make it the best choice. The Fort Washington, Pennsylvania-based company has a history of advocating for life settlement regulation.
You can start the life settlement process by submitting a questionnaire, authorization, insurance carrier illustrations, and your past five years of medical records. The company also completes a background check to prevent fraud. Coventry offers a retained death benefit, allowing you to keep part of your policy’s payout after you stop paying premiums.
To qualify, you must be at least 65 years old and your policy’s death benefit must be at least $100,000, and your life expectancy can’t be more than 20 years. The exact payout depends on variables like your health, the type of insurance policy, the policy’s premiums, and more. Coventry doesn’t charge a brokerage fee to policyholders.
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Abacus Life Settlements made our list because of the company’s fast quotes and sale process. You can expect a quote and see what your policy is worth within 24 hours. Abacus will generate a formal offer within 14 to 21 days. The money will then arrive in your bank account within 21 days of accepting the offer. This is faster than the other companies we reviewed and makes Abacus Life Settlements best for fast sales.
Pros & ConsAbacus Life Settlements is one of the fastest-growing life settlement providers, with 18.5% growth over the past year. Founded in 2004, the Orlando, Florida-based company is our top choice for speedy quotes and fast life settlements. The company beats the competition for fast quotes and sales with artificial intelligence to expedite the underwriting process. The company was named as one of the top life settlement providers of 2020 by The Deal.
You can start the life settlement process by completing Abacus’ one-step qualifier, which provides a fast quote through the company’s website. You also may accomplish the same thing by calling their team. Formal offers are presented within 14 to 21 days. Money arrives in 21 days or less after accepting.
Abacus is looking for customers in their mid-to-late 70s or individuals with poor health. Most life insurance policy types are accepted with the exception of standard term life, but convertible term is accepted. Policies must have a death benefit of at least $100,000. To determine your payout, Abacus considers your policy type, face value, age, and health status. Abacus’ website says it typically pays six to eight times your policy’s cash surrender value. The company’s average payout is 23.3%.
