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What is a Viatical Settlement?

Viatical settlements allow someone diagnosed with a life-threatening illness to sell their life insurance policy for cash. This person is known as the “viator.”

The third party they sell their policy to is an institutional investor, usually a viatical settlement company such as us here at American Life Fund.

A viatical settlement is a legally enforceable agreement between a life insurance policyholder with a severe illness (viator) and a viatical settlement business.

How Does a Viatical Settlement in Pennsylvania Work?

The process begins when the policyholder contacts a viatical settlement company like American Life Fund. After an initial consultation, the viator will apply.

Once the application is received, our underwriters will evaluate the case and verify all information provided by the viator.

If the case is approved, the viator will be asked to sign contracts issuing the viatical company as the new policy owner and beneficiary in exchange for the agreed-upon offer amount. Then we will issue a payment for the offer amount. It’s that simple! The entire process can take as little as two weeks from start to finish.

Viatical Settlement in Texas

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Who Is Eligible For A Viatical Settlement in Pennsylvania?

Insured’s Health

To qualify for a viatical settlement, the insured must be diagnosed with a life-threatening illness such as cancer or ALS.

Policy Type

All life insurance policy types are accepted. Whether you have whole life, term life, universal, group, or joint life insurance, you could be eligible for a viatical settlement. However, if the policy is issued through an employer, the insured must be separated from the employer or nearing separation from their employer in order to sell their policy.

The Age Of The Life Insurance Policy

The life insurance policy must have been in place for at least two years.

The Value Of The Life Insurance Policy

The life insurance policy must have a death benefit of at least $150,000.

What are the Benefits of a Viatical Settlement in Pennsylvania?

There are many benefits of entering into a viatical settlement. However, the two most common reasons people do it are for the money and to ease the burden on their loved ones.

Some other benefits include:

  • No medical exams are required
  • You can use the money however you want
  • It’s a speedy process
  • You can choose the settlement company you want to work with

American Life Fund is one of the leading viatical settlement companies serving the citizens of the USA. We have helped many people through this difficult time in their lives.

Viatical Settlement in Texas

How are Viatical Settlement Payments Calculated?

Viatical Settlement in Texas

The payout you receive from a viatical settlement is based on several factors, including but not limited to:

  • The death benefit of your life insurance policy
  • Your health condition
  • The type of life insurance policy you have

These are just a few of the factors that will affect your payout. For an accurate and free quote, call us at 877-590-4088, and one of our expert representatives will be more than happy to help you.

The Pros And Cons Of A Viatical Settlement

Not sure if a viatical settlement is a right move for you or your loved one? Here are some things to keep in mind.

Pros:

  1. You’ll get a one-time payout much higher than the cash surrender value through a viatical.
  2. Help pay for medical expenses such as medical premiums, treatment, or long-term care.
  3. Use your money for better care, travel, or anything else to make you happier.
  4. With a viatical settlement, you can stop making premium payments. The new owner i.e. the viatical settlement company, will take over those responsibilities. They will also be in charge of any other maintenance costs.

Cons:

  1. Government assistance programs such as Medicaid are need-based programs based on your income and assets, so you may lose eligibility if your finances improve.
  2. Beneficiaries won’t be able to receive the death benefit from your life insurance policy  unless you choose to give them part of your viatical settlement payout.

Viatical Settlement Examples

Here are a few examples of how people have used their viatical settlement payouts:

  • John had a life insurance policy with a $500,000 death benefit. He was diagnosed with terminal cancer and decided to enter a viatical settlement. He received a payout of $300,000 and used the money to travel and spend time with his family members.
  • Mary had a life insurance policy with a $250,000 death benefit. She received $150,000 and used the money to pay for her medical expenses and treatments.
  • Mike had a life insurance policy with a $150,000 death benefit. He received $90,000 and used the money to pay off his debts.

As you can see, viatical settlements can be very beneficial for seriously ill people who need financial assistance.

Viatical Settlement vs Life Settlement

When looking into viaticals, you may hear the term “viatical life settlement” thrown around — but viatical settlements and life settlements are two separate transactions. A life settlement is similar to a viatical settlement, but the two have several key differences.

How do life settlements work?

  • A life settlement is a transaction that occurs when an individual over 75 sells a life insurance policy to a settlement provider for cash, usually yielding considerably more than the policy’s surrender value.
  • The size of a life settlement payout is mostly determined by the policyholder’s health status and the premium payments of the policy. The money from selling life insurance policies can be used to finance long-term care, medical procedures, travel, or family events.
  • Many people are unaware they can sell their life insurance policy for cash. When a policy becomes too expensive or unnecessary, the owner typically lets it lapse without knowing there is another option—the life settlement market.
Viatical Settlement in Texas

Alternatives To Viatical Settlements

Not sure if a viatical settlement is right for you? Here are some other options to consider

Withdrawals

You can withdraw from the cash value of your life insurance policy, but this will reduce the death benefit paid to your beneficiaries.

Surrendering the policy

You can cancel your life insurance policy and receive the cash surrender value. This is usually a bad idea because you will get less money than if you had sold the policy in a viatical settlement.

Although viatical settlements offer many benefits, they aren’t the only form of financial assistance available. Be sure to speak with a professional before making any decisions.

Is a Viatical Settlement Right For You?

With life insurance policies increasing daily, it’s important to consider all options before deciding. For those with a chronic or terminal illness – selling your policies may be one way to afford quality care while still securing a financial cushion that will help you improve your quality of life.

If you or a loved one is facing a life-threatening illness and needs a Viatical Settlement, please call us at 877-297-4592 to see how we can help.

What is a Viatical Settlement?

If you or someone you care about in Pennsylvania is dealing with a life-threatening illness, viatical settlements provide a financial option. This arrangement allows you to convert your life insurance policy into immediate cash.

Choosing a viatical settlement is more than just selling a policy; it’s a choice to remove financial stress during a difficult period. At American Life Fund, we recognize the delicacy of your circumstances and are committed to helping you manage this process effectively. Our goal is to help you concentrate on what’s most important.

Pennslyvania Counties Eligible for Viatical Settlements

Adams, Allegheny, Armstrong, Beaver, Bedford, Berks, Blair, Bradford, Bucks, Butler, Cambria, Cameron, Carbon, Centre, Chester, Clarion, Clearfield, Clinton, Columbia, Crawford, Cumberland, Dauphin, Delaware, Elk, Erie, Fayette, Forest, Franklin, Fulton, Greene, Huntingdon, Indiana, Jefferson, Juniata, Lackawanna, Lancaster, Lawrence, Lebanon, Lehigh, Luzerne, Lycoming, McKean, Mercer, Mifflin, Monroe, Montgomery, Montour, Northampton, Northumberland, Perry, Philadelphia, Pike, Potter, Schuylkill, Snyder, Somerset, Sullivan, Susquehanna, Tioga, Union, Venango, Warren, Washington, Wayne, Westmoreland, Wyoming, and York

At American Life Fund, we recognize the difficulties that come with facing a life-threatening illness, especially in a vibrant city like Philadelphia. Whether you’re in Center City, South Philadelphia, or any other neighborhood in the county, considering a viatical settlement is a major decision. Our team is here to offer support and guidance tailored to the specific needs of Philadelphians. With our expertise in viatical settlements, we provide assistance to help you understand this financial process. We are committed to making sure that you have all the information necessary to make informed choices about your financial future during this challenging time.

In Allegheny County, the heart of Pittsburgh, American Life Fund is your trusted partner in viatical settlements. We understand the significance of securing your financial stability, especially when facing challenging circumstances. Our team is devoted to delivering solutions that guarantee you the highest possible value for your life insurance policy. With a commitment to transparency and dignity, we streamline the process, allowing you to concentrate on what truly matters. Whether you’re in downtown Pittsburgh, the suburbs, or anywhere in Allegheny County, we’re here to provide the support you need during this time.

For residents of Montgomery County, American Life Fund is proud to serve as your partner in viatical settlements. Whether you’re in Norristown, Abington, or any other community in the county, we are dedicated to offering support tailored to your specific needs. Our experienced team understands the challenges you may encounter and is quick in delivering prompt financial relief. With American Life Fund by your side, you can rest assured that you’re in capable hands every step of the way.

At American Life Fund, extending our services to Bucks County signifies offering a lifeline to residents during challenging times through viatical settlements. Whether you’re in Doylestown, Bensalem, or any other area in Bucks County, we are committed to supporting you with financial freedom during this time. Our team is here to help you understand viatical settlements, guaranteeing an easy process for both you and your loved ones. With American Life Fund, you can trust that we’re here to provide guidance every step of the way.

In Delaware County, American Life Fund stands as a source of dependable viatical settlement services. Whether you’re in Chester, Upper Darby, or any other part of the county, we’re dedicated to easing your financial hardships with a seamless process. Our team places your needs at the forefront, working to secure the funds you need in a timely manner. Count on us to be your partner and be with you every step of the way.

In Chester County, American Life Fund is honored to extend our viatical settlement services to residents in need. Whether you’re in West Chester, Coatesville, or any other corner of the county, we understand the impact that a life-threatening illness can have on your financial stability. Our mission is to extend a helping hand, guiding you through the viatical settlement process. We are fully committed to making sure that you receive the financial support you need, helping you regain peace of mind during these difficult times.

Insights for Viatical Settlements in Pennsylvania

Pennsylvania’s population is currently around 13 million as of 2023, with a modest growth rate of about 1% since 2020. Of this population, approximately 18.5% are seniors aged 75 and older, a demographic increasingly facing higher healthcare needs and related costs. 

According to a 2024 report by the long-term care financial company Genworth, the average cost of assisted living in Pennsylvania is about $4,200 per month. This data points to the potential financial pressures faced by individuals, especially older adults or those with serious health conditions.

Another study on the Prevalence and Medical Costs of Chronic Diseases Among Adult Medicaid Beneficiaries, Costs among beneficiaries with cancer were $29,384–$46,194 for the 6 months following diagnosis. Clearly a monthly pension is not enough to handle everything.

A viatical settlement in Pennsylvania could provide a key financial boost by offering a lump sum cash payment. This gives you options in better managing healthcare costs, living expenses, or even achieving personal goals during difficult times.

 

FAQ about Viatical Settlement in Pennsylvania

In Pennsylvania, the viatical settlement process allows individuals facing life-threatening illnesses to sell their life insurance policies to third parties for a lump sum. This sum typically falls between the death benefit and the cash surrender value of the policy. The process involves several steps, including:

  • Finding a viatical settlement company operating in Pennsylvania.
  • Submitting an application for the settlement.
  • Undergoing a thorough review of both your life insurance policy and medical records.
  • Receiving an offer based on the evaluation.
  • Transferring the ownership of the policy to the buyer upon acceptance of the offer.

Specialized companies such as American Life Fund are equipped to provide assistance throughout this process.

In Pennsylvania, viatical settlement providers are required to register with the Pennsylvania Insurance Department, as outlined in 5 P.S. § 3334. There’s a separate licensing process for viatical settlement brokers.

According to Pennsylvania law (5 P.S. § 3334.1), there is no minimum payout requirement based on the cash surrender value of the life insurance policy.

Pennsylvania law (5 P.S. § 3334.2) permits settlements two years after policy issuance, with some exceptions for individuals with a life-threatening illness.

Licensing for viatical settlement providers in Pennsylvania is overseen by the Pennsylvania Insurance Department, as mandated by 5 P.S. § 3334.

Viatical settlement proceeds are typically not subject to federal income taxes for seriously ill individuals, as per the guidelines outlined by the Internal Revenue Service (IRS). This tax exemption applies if the policyholder is chronically or terminally ill. However, it’s important to note that tax laws can be intricate, and there may be specific state tax implications in Pennsylvania. For personalized advice regarding tax matters related to viatical settlements in Pennsylvania, it is advisable to consult with a qualified tax professional.

Yes, policyholders typically have a rescission period during which they can reconsider their decision after accepting a viatical settlement offer. This period usually lasts for a few days after receiving the funds (often 15 days), but it may vary depending on the terms outlined in the contract and Pennsylvania state regulations. It’s important to carefully review the terms of your viatical settlement agreement to understand the specific conditions and time frame for rescission.

Pennsylvania maintains regulations to protect the privacy of individuals throughout the viatical settlement process. These regulations include requirements for viatical settlement companies to adhere to state laws governing the confidentiality and security of personal and health information. Companies operating in Pennsylvania are mandated to uphold the privacy of policyholders’ medical records and personal data, using it only as necessary to facilitate the settlement process

When selecting a viatical settlement provider in Pennsylvania, it’s important to seek out companies that are licensed and regulated by the Pennsylvania Insurance Department. Conduct thorough research on potential providers, evaluating factors such as their reputation, experience, and the terms they offer. Reputable viatical settlement companies like American Life Fund can provide guidance and support tailored to your needs throughout the process.

In Pennsylvania, policyholders have rights including:

  • Receive detailed disclosures about the settlement process, fees, and compensation.
  • Be informed about alternatives to viatical settlements.
  • Have their privacy protected, including the confidentiality of medical and personal information.
  • A rescission period to change their mind after accepting an offer.

These rights are established to protect policyholders and promote transparency and fairness throughout the viatical settlement process.

Once a viatical settlement transaction is finalized, and the policy is sold, the agreement becomes binding, irrespective of any alterations in the seller’s life expectancy. The viatical settlement company assumes the risk associated with potential changes in the seller’s life expectancy. If the seller outlives the initial life expectancy estimate, the settlement amount remains unchanged, and the company retains ownership of the policy.

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