Frequently Asked Questions About Funding for Cancer Patients

American Life Fund > Frequently Asked Questions About Funding for Cancer Patients

Frequently Asked Questions About Funding for Cancer Patients

Q: Is it legal to sell a life insurance policy as funding for cancer patients?

A: Yes. In 1911 the Supreme Court ruled that life insurance policies are an asset. Like all assets, policies are freely assignable for value. Once a life insurance policy is issued, it is the property of the contract owner. Once the contestability period has passed, the policy owner has the right to get rid of the policy. They can then use the proceeds as funding for cancer patients.

Q: Why sell my life insurance policy?

A: Selling your life insurance policy is a decision that is very personal and differs for each individual. The most common reason an individual wants this type of funding for cancer patients is because they want to enjoy the financial benefits in the present, with their family and friends.

  • Financial Reasons:
    • Pay medical cost
    • Pay off debt
    • Pay living expenses
    • Policy premium no longer affordable
    • Relieve financial stress

There are many other reasons you may want to choose a viatical life insurance settlement.

Q: How does a viatical settlement work?

A: To begin the viatical settlement process,  contact American Life Fund today at (877) 421-0148 to speak with an American Life Fund Counselor. American Life Fund will then guide you through a pre-qualification process and ask you to fill out one easy form. After you have passed the pre-qualification process, we will review your medical records and life insurance policy in more depth. If the qualification needs are met, you will be given an offer for your policy. If accepted, a sale/purchase agreement will be put together for you to review and sign. Your life insurance carrier will be instructed to make the necessary ownership changes to the policy. After the changes to the policy are confirmed, funds will be released to you from the investor’s escrow company.

Q: Why choose American Life Fund?

A: There are many viatical settlement companies that would be happy to help you through this time in your life. ALF understands the sensitivity of the decision to sell your policy. We provide one-on-one communication with each client and have a financial counselor on hand to answer any questions the seller may have about funding for cancer patients. We make it our responsibility to get you the highest offers possible.

Q: How can I apply with ALF?

A: Applying for a viatical settlement with American Life Fund is a painless process. All application forms are displayed online on our website. Once you have printed off the forms and completed them, you may mail the application forms back to our home office at 3295 River Exchange Drive, Suite #350, Norcross, GA, 30092.

You can also scan and email the completed forms to us. Lastly, you may fax the forms to (855) 727-4663. Once the forms are received, a financial counselor will contact you within 24 hours.

Q: Is the process confidential?

A: Yes. American Life Fund has extremely strict regulations on confidentiality. No medical, financial, or other personal information about the seller and/or the insured which American Life Fund obtains will be disclosed to any other person or entity without written consent, unless required by law.

Q: Can I change my mind?

A: Yes. You can change your mind about the viatical company and get the policy transferred back to you while the transaction is still in closing. You may also stop the application process at any time. There is absolutely NO obligation to accept this funding for cancer patients until closing documents are signed and notarized.

Q: Do I need to take a medical exam?

A: No. ALF will contact your physicians to obtain your most recent medical records. However, it does speed up the application process if you provide copies of your most recent medical records at the time of application.

Q: Am I responsible for future premium payments?

A: No. The viatical company covers all future premium expenses. You are no longer responsible for any future premiums payments and hold no responsibility to the policy.

Q: Are there any restrictions on the proceeds?

A: Viatical settlement companies require absolutely no restrictions and sellers are free to use the funding for cancer patients however they wish.

Q: What type of policy can be purchased in a viatical settlement transaction?

A: Most types of policies including term life insurance, universal life insurance, whole life insurance, group life insurance, or key-man life insurance can be purchased by a third party.

Q: How long does it take to complete the transaction from start to finish?

A: ALF’s goal is to complete most transactions as soon as possible. Obtaining the individual’s medical records is one factor that may hold the process up. If the individual provides their most updated medical records from the last two years as well as a copy of the insurance policy at the time of applying, ALF can present offers within 2-3 weeks! Once the closing documents are signed and notarized by the seller and the change forms have been processed by the insurance carrier, funding for cancer patients can be released to the seller by the investor’s escrow company.

Q: How is my offer determined?

A: The amount to be paid to the owner of a policy depends upon various factors such as medical condition, age of the insured, amount of future premiums due to keep the policy in force and the cash surrender value of the policy. A typical offer on funding for cancer patients can range anywhere from 50% – 75% for the face value of the policy. Learn more about how a viatical settlement company will determine your offer.

Q: Are viatical proceeds taxable?

A: No. Congress passed portions of the Health Insurance Portability and Accountability Act that exempt viatical settlement proceeds from income taxes (HIPAA, 1996). This law enables individuals that are deemed terminally ill the ability to not be taxed on the proceeds from their viatical settlement. ALF recommends individuals to contact their tax adviser to find out about any tax implications.

Q: Is there any cost or obligation?

A: No. There is no cost or obligation to the seller to accept a viatical settlement. There is NO cost to apply with ALF.

Q: Who can offer a viatical settlement?

A: There are a number of companies that can offer life settlements or the sale of a life insurance policy usually involving a healthy, senior-aged individual. However, only viatical settlement companies can offer viatical settlements.  

Q: What are the benefits of working with viatical settlement companies?

A: Viatical settlement companies can help with the financial aspects of the cancer experience. Essentially, viatical companies give you a settlement in exchange for your life insurance, and working with these companies offers a long list of benefits.

Q: What should I do before applying for a viatical settlement?

A: There are a few steps you can take before applying for a viatical settlement. Completing these ahead of time will help the process go more smoothly and quickly.

Q: What is the difference between viatical settlements and life settlements?

A: A life settlement is when a healthy, senior-aged individual sells their life insurance policy to a company. A viatical settlement is when someone with a life-threatening illness sells their life insurance policy to a company.

Q: How can a viatical life insurance sale help my loved ones?

A: Dealing with a terminal illness is incredibly difficult for the patient as well as for their loved ones, both emotionally and financially. A viatical life insurance sale is one solution that provides peace of mind and the cash you need when you need it the most.

Q: Is a viatical settlement the right option for me?

A: Trying to balance your finances is difficult, even when you have a clean bill of health. If you have been diagnosed with a life-threatening illness, making financial decisions carries even more weight, as you try to cover illness-related expenses and take care of your loved ones at the same time. One financial solution is a viatical settlement. So how does a viatical settlement work and how do you know if it is right for you?

Q: What bills should I pay first?

A: When you have cancer, you need to focus on your health, but unfortunately, that can be difficult when you have financial responsibilities and bills breathing down your neck. Many people consider letting their life insurance payments lapse, but if you are thinking of going this route, you should always opt for a viatical settlement first.

Q: What are my other options?

A: Viatical settlements are one way to obtain the funds you need by selling your life insurance policy. Additionally, there are other financial options to consider.

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