Whether you sell a life insurance policy as either a Viatical Settlement or a Life Settlement/Senior Settlement, the sale process is the same.

The sale process breaks down as follows. Each step is described in the other sections of this article.

• The application
• The underwriting process
• The offer stage
• The contract state
• Transfer of title and getting you the money

For additional information see:

• Sale Of A Life Insurance Policy
• What Is The Best Way To Sell A Life Insurance Policy?
• New Uses Of Assets - Living Benefit From A Life Insurance Policy

To begin the process of selling a life insurance policy you will need to complete an application with a broker or directly with a purchasing company.

You will be asked to provide:

• Personal information including your name, address, phone number, Social Security number and date of birth.
• Information about your life insurance policy including policy number, name of insurance company, date of issue and name of beneficiary.
• A copy of the policy. It is okay if you do not have a copy of the policy when you apply for a sale. Check with the purchase to find out if you will need a copy before the final sale. Many purchasers will accept a recorded Lost Policy Affidavit from you and a "Confirmation of Coverage" from the insurance company if a policy copy cannot be obtained. Otherwise, check to see if you can get a copy from the insurance company or the group through which you have your insurance, such as your employer.
• Information about your current medical condition, including:
• Your diagnosis
• Date of diagnosis
• Your doctor's name and address
• Complete medical records for the past two years.
• Authorizations for the release of both medical information and insurance information. The medical release must comply with the requirements of HIPAA so the doctor's office can legally give information to the purchaser. (To learn more, see HIPAA.) Both of these documents will need to be notarized. Don't be surprised if the authorization is for life instead of for a set period of time. It is also not uncommon for the authorization to be in the form of a Durable Power Of Attorney which authorizes the purchaser to update the insured's medical status. If a Durable Power of Attorney is required, be sure it is limited to only authorizing the purchaser to update the insured's medical records.

Once your application is submitted, the broker or purchasing company will begin their underwriting process. The underwriting process assesses whether your policy and medical condition are salable.

If it hasn't already, the potential purchaser will obtain copies of your medical records and verification of your insurance coverage - confirming the amount of the death benefit, effective date of issue, existence of any loans or liens, and all other policy provisions.

While a few larger purchasers evaluate your medical condition in-house, most purchasers send your records to a third party for evaluation - a very good reason to be certain that you are dealing with a reputable firm.

After underwriting has been completed, the purchaser or broker will either make an offer to you or indicate that an offer cannot be made.

You are never obligated to accept an offer that is made. However, you generally must respond to an offer within two weeks if you are interested in the price being offered. Many companies do not hold an offer open beyond two weeks without a valid reason.

If you are uncertain about accepting an offer but wish to keep the offer open, before two weeks are up, ask that the company send a contract to review. Even if you decide not to sign the contract, you will have bought yourself a little time.

Review every word of a contract before signing.

You have the right to change your mind about an offer you accept:

• At any time during the sale process until a contract is signed by both parties.
• In most states where the purchaser is regulated, you have up to 15 days after a sale is complete to rescind it. In unregulated states, you may only have three days to rescind the contract.

Upon verbal acceptance of an offer, the purchaser will send you a contract for review. Purchase contracts are generally straightforward, but do vary from company to company. As you review the contract, be sure that:

• The purchase price is clearly indicated -- as a dollar amount rather than as a percentage of the death benefit.
• Your relationship with the purchaser as a result of the sale is clearly indicated. For example:
• How often will the purchaser contact you after a sale has taken place?
• Does the purchaser have a right to contact your beneficiary?
• Does the contract state that you have other obligations as a result of the sale?
• An escrow agreement with a national bank or other reputable independent entity should be included as part of the contract. The contract should provide that the papers you sign transferring the ownership of your policy are held in escrow until funds are transferred equal to the price you are to receive. This mechanism assures that you will receive the proceeds in return for a sale of your policy. The escrow agreement should provide what happens in the event that any party does not, or is not able to, satisfy their contractual obligations.
• Any contingencies are clearly indicated. An example of a contingency might be that the purchasing company requires receipt of a copy of the original policy before it pays you any money (assuming that you only submitted a copy originally).

Note any date by which you must return the contract before the offer expires. This should be a reasonable amount of time (usually between 15 and 30 days.)

Be wary of any intense pressure from a purchaser or broker.

It is always a good idea to have every contract reviewed by an attorney. At least, review the documents with an attorney if anything seems peculiar to you and/or you are unable to receive a suitable explanation for any questions you may have.

Once you return contracts to a purchasing company:

• The purchaser places the purchase funds in escrow -- typically within three days of the purchaser's receipt of your copy of the signed contract (particularly in regulated states.) The seller can contact the escrow agent to confirm that the money has been transferred.
• The purchaser then submits a "change of ownership" and "change of beneficiary" form to your insurance company for the actual transfer of ownership to take place.
• How long it takes the insurance company to change ownership depends on the insurance company. The length of time can vary dramatically depending on the insurance company. Since you are still the owner of the policy until the insurance company changes title to the purchaser, if you would like, you have a right to contact the insurance company yourself during this process and ask to expedite the changes.

When the purchaser receives written confirmation that the changes to the policy have taken place, the escrow agent will release your funds to you in the manner and in the name that you have requested (usually via wire transfer or certified check).