Over 75 million baby boomers are reaching retirement age, and many need alternative solutions to help close gaps in their retirement plans. For some, life settlements can provide the cash they need while simultaneously reducing the expense of maintaining an unneeded and unwanted life insurance policy.

A lot of seniors find themselves with liquidity needs or with a life insurance policy that’s too expensive,” said Philip Giordano, president of SFS Life Settlements. “Knowing about a life settlement is going to be one more option for them to make ends meet.”

Giordano, who specializes in life settlements, explained that many seniors are missing this opportunity if their advisors are either not familiar with life settlements or harbor lingering fears because of previous litigation issues within the industry. Those issues, Giordano said, are no longer a problem, adding that the industry is now regulated in 42 states.

Giordano wants to educate individuals and advisors to consider life settlements as an option, yet, he acknowledges that they are not suited for everyone. There are strict standards, but for those who qualify, life settlements can be the perfect solution.

If an individual no longer has need for a million-dollar insurance policy, Giordano explained as an example, they may only get $20,000 in cash value from the insurance company; however, they could potentially receive $150,000 through a life settlement offer. “It’s Important not to let a policy lapse without at least taking a look and seeing if a life settlement might be a good option for you,” he said.

Life settlements are typically available to those holding A-rated universal life policies, or a term policy with conversion privileges for the insured with a life expectancy of less than fifteen years, depending on the premium and benefit ratios.

Because it can be the best option for some individuals, there’s an increasing need and opportunity for investors, as well. “For investors, if they are putting their money in this asset class, they can be confident that the death benefit is going to be paid out one way or the other,” Giordano said, adding that life settlements don’t have the same investment volatility as stocks or real estate.

Life settlements became popular with terminally ill patients as the AIDS epidemic of the 1980s took hold. A decade later, the trend shifted towards seniors, and the industry, as a whole, took a few hits as life expectancy took a sizable jump. “A lot of investors had large portfolios with billions of dollars in policy face value that were now under water,” Giordano said.

Today, life expectancy companies conduct a comprehensive analysis of the insured, looking at age, health conditions, lifestyle, and more, and have adjusted mortality tables to be much more conservative with today’s increased longevity. Risk to investors is greatly reduced, making life settlements an attractive and growing alternative investment.

“Mortality is one of the biggest factors—if not the biggest—in our industry,” Giordano said. “A risk to the investors is considered an increase in life expectancy. I feel like, in general, a lot of that risk has been flushed out because life expectancy companies are overly conservative today.”

For more information please visit: www.sfslifesettlements.com