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Life insurance plans can bring in extra money for seniorsPosted On Thu, July 29, 2010
A life settlement transaction may yield larger profits than some may think. A recent report released by the U.S. Government Accountability Office found that seniors profited eight times more by selling their life insurance policy than they would have if they surrendered the plan.
Using the study sample, life insurance holders would have received $37.4 million if they had surrendered their policy. However, the plans brought in $269 million from settlements.
The funds received from selling a life insurance plan can bring in extra money an elderly person needs to cover expenses.
Among other findings, the study also revealed that many states are lagging behind in terms of creating rules for the life settlement market.
President of the Life Settlement Institute Brian Smith says that such findings don't surprise him.
"This finding also comes as no surprise to us. We have been working with state legislators and state insurance regulators to adopt consistent model legislation across the country and eliminate such discrepancies," say Smith. "Last year we helped get legislation enacted in several states including New York and California."
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