Viatical Settlements
FAQ
How will I know who will be calling me or my contact
person about my health status and how often can they call?
The provider must give you the name, address, and phone number of
the person who will be contacting you or your contact person(s) about your
health status. If your life is expected to end in one year or less,
contacts to check on your health status are limited to once every 30 days.
If you are expected to live for more than one year, contact is limited to
once every three months.
Will the provider be calling my doctor to check on
my health status?
Some providers will use your signed medical release form to check with
your doctor, for updates on your health status. The medical release form
tells your doctor that you want your doctor to give your medical
information to the provider, their broker, or provider representative. If
you decide you do not want the provider to contact your doctor, you have
the right to withdraw your medical consent in accordance with law.
How will I know if my policy includes extra
coverages like accidental death, future increases in the death benefit, or
covers other family members? Do these affect my settlement?
Some policies contain extra coverages. You may want to contact your
insurance company or agent to see if your policy contains a provision or
rider providing extra coverages. If your policy includes a benefit for
accidental death, the additional death benefit may not be included as part
of your settlement. The additional death benefit will remain payable to
your beneficiaries or your estate. If your policy provides future
increases in the death benefit, you may want to ask how much the provider
is paying you for the purchase of this benefit. If your policy is a joint
policy, or provides coverage on the lives of other family members or
anyone other than yourself, there may be a possible loss of coverage.
Are there other options available besides selling my
policy?
Your insurance company may offer options, such as accelerated death
benefits, loans, and surrender of the policy for its cash value. Before
entering into a viatical settlement, you should contact your insurance
company or agent to see what options are available.
What other things should I know about a viatical
settlement contract?
Some things that may be affected if you enter a viatical settlement
are:
-
There may be a loss of life
insurance coverage on your spouse or other family members, if the policy
(or any riders attached to it) covers their lives;
-
The amount of premiums you
pay;
-
Policy cash values or
dividends, if provided for in the policy;
-
A loss of other rights or
benefits, including conversion rights and waiver of premium benefits
that may exist under the your policy;
-
You may incur tax
consequences;
-
Your ability to receive
supplemental social security income, public assistance, and public
medical services including Medicaid; and
-
The money you receive for
your viatical settlement could be taken away from you by creditors,
personal representatives, trustees in bankruptcy, and receivers in state
or federal court.
Because of the above, you
should contact an attorney, accountant, estate planner, financial planning
advisor, tax advisor, social services agency, your insurance company, or
agent, as applicable, to find out what effect selling your policy will
have on you.
What if I have a complaint?
You may file a complaint with the Department of Insurance in your
state of residence. Click here to link to your state’s.
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