Learning Center

Frequently Asked Questions

Q: What is a Life Settlement?

A: A Life Settlement is the sale of an existing life insurance policy to a third party for more than its cash surrender value but less than its net death benefit. Depending on the state, a Life Settlement usually refers to a transaction involving an insured who is not terminally or chronically ill, generally over the age of sixty (60). For additional information about life settlements, refer to this blog article.

Q: Do I qualify for a life settlement?

A: Q Capital purchases life insurance policies with a face value in the range of $50,000 to $50,000,000 that insure the lives of U.S. residents over the age of 60. See if you qualify by using Q Capital’s life settlement calculator. You can also contact one of our experts to discuss whether you qualify or not.

Q: What types of policies do you buy?

A: Most types of life insurance policies can qualify; however, the most common are universal life, survivorship, whole life, convertible term, indexed, and variable life. For additional information on this topic, refer to these two blog posts (Part 1 and Part 2).

Q: How much money will I get if I sell my life insurance policy?

A: The value of a life insurance policy is determined by a number of factors, including, but not limited to, the age and medical condition of the insured, type of insurance policy, rating of the issuing insurance company, and amount of premium payments to keep the life insurance policy in force. For additional information about life settlements, refer to this blog article.

Q: After I sell my policy, are there any restrictions on how I can use the money?

A: No, there are no restrictions on use of the funds – the money is yours to spend as you like.

Q: Are the proceeds of a Life Settlement taxable?

A: You should consult with your attorney, financial advisor, accountant, and/or tax advisor before entering into a Life Settlement to understand the tax implications of the transaction. For additional information about the taxation of life settlements, refer to this blog article.

Q: What are some of the reasons why I might consider the sale of my policy?

A: There are myriad reasons why a life settlement might be right for you, including:

  • The policy is no longer needed or wanted
  • To pay for healthcare costs
  • Premium payments have become unaffordable
  • Considering lapse or surrender of the policy
  • Change in estate planning needs
  • To purchase a different financial product/investment

Refer to this blog article for additional information regarding reasons you may consider selling your life insurance policy.

Q: What happens to the policy after I sell it?

A: All rights and obligations of the policy are transferred to the new owner. You will no longer be responsible for making premium payments on the policy, the new owner will. The new owner will name a new beneficiary of the policy who will collect the proceeds upon the insured’s passing.

Q: Does my state regulate Life Settlements?

A: Life Settlements are regulated by state insurance departments. Some states have enacted statutes and laws addressing the sale of life insurance policies and others do not regulate the transaction at all. Of those states that regulate the transaction, Q Capital is registered or licensed to transact life settlements in almost all jurisdictions. Please click here for detailed state by state information.

Q: What is the process for selling you my insurance policy?

A: To get started we recommend you contact us at 800-554-2145 or provide your information for one of our experts to contact you. Once you determine that a life settlement is appropriate, you can provide policy and medical information to Q Capital. One of our underwriters reviews the case and will make an offer to purchase your policy. If you accept the offer, closing documents and policy ownership transfer forms are completed. Cash payment is transferred from an escrow account to the you. The institutional investor assumes ownership of the policy and makes all future premium payments.

Q: How long does it take to close the sale of my insurance policy and receive my payout?

A: Q Capital has streamlined the process to make it very efficient. This enables you to receive a lump sum cash payment in 4 weeks or less from submission; quicker than most competitors. The Life Insurance Settlement Association (LISA) has a detailed infographic on the life settlement process that is a great resource for understanding the process and timing of a life settlement transaction.

Q: Are you properly licensed in multiple states?

A: Currently, Q Capital purchases policies in 46 states and the District of Columbia and is actively pursuing licenses or registrations in all jurisdictions, so if we are not currently licensed or registered in your state, check back regularly for updated information. 

Q: Do you need to be licensed to buy my policy?

A: There are 43 states that require a license to purchase a life insurance policy in a life settlement transaction. We are licensed or registered in the 32 most active states in the life settlement market, and also purchase policies in the 7 states that do not regulate life settlement transactions.  Refer to this infographic for the states that we are currently licensed. Check back regularly for updated information.

Q: Who is the owner of my policy after I sell it?

A: An institutional investor assumes ownership of the policy. Not only does institutional backing provide a secure funding source, it also provides the highest degree of consumer protection with regard to privacy and confidentiality. At no point should a client’s policy, or the personal information associated with it, ever be in the hands of an individual investor.

Q: Do I have any ongoing obligations after I sell my policy?

A: All rights and obligations of the policy are transferred to the new owner. The premium payments are now made by the new institutional owner. You may be required to periodically provide an updated medical records release form.

Q: Are there costs involved?

A: There are no out of pocket fees paid by the seller. The purchaser of the policy pays all of the transaction fees.

Q: Is my personal information kept confidential?

A: Yes. All medical, financial and other personal information obtained during the course of the transaction is treated with the utmost confidentiality and will not be disclosed to any unauthorized party. The Company requires that prior to releasing any personally identifiable financial or medical information to any party outside the company, confidentiality agreements are signed by all parties. Moreover, Q Capital will also determine if the information is subject to the confidentiality agreements of the Health Insurance Portability and Availability Act, the Gramm-Leach-Bliley Act, or state confidentiality laws. All records are stored in a secure location in accordance with state laws. Further information regarding Q Capital’s compliance, please refer to our corporate policies and procedures here

Q: Are you institutionally funded?

A: Yes. We are funded by several, recognized national, international, and foreign financial institutions. Q Capital is backed by large institutional investors who understand this unique asset and invest in it for the long term. We do not do business with individual investors.

Q: Does the company employ and engage in sound business practices?

A: Q Capital Strategies has developed a comprehensive Anti-Fraud Program which is not only compliant with state insurance anti-fraud regulations, but also is more rigorous than any current legislation in the industry. Q Capital is the most compliant and highly rated provider in the industry. For further information regarding Q Capital’s corporate policies and procedures, please click here.

Q: Has (or is) the company been involved in any state insurance department complaints or legal action?

A: Q Capital has maintained a clean regulatory record. We have one of the best reputations in the industry. We belong to LISA, the trade association for life settlements, which holds us in good standing.

Q: Does Q Capital have an in-house legal or compliance department?

A: Yes. Q Capital has both legal and compliance departments headed by our General Counsel. The Company’s President and CEO is the immediate past Chair of the Board of Directors of the Life Insurance Settlement Association (LISA), the life settlement industry’s trade association. Q Capital takes compliance very seriously.

Q: Does Q Capital strive to protect all parties involved in the transaction?

A: Q Capital has one goal – to take as much risk as possible out of this swiftly growing market – for both sellers and buyers. For further information regarding Q Capital’s corporate policies and procedures, click here.

Q: Does Q Capital carry Errors & Omissions (E&O) insurance?

A: Yes. The company has $5 million worth of coverage, amongst the highest level of any company in the industry.

Q: Are due diligence, anti-fraud, and consumer privacy measures utilized?

A: The company has formal anti-fraud plans filed in states where it is regulated and adheres to these practices in all jurisdictions, whether required by law or not. Q Capital performs routine due diligence on all cases and has the highest standards in the industry for protecting consumer’s privacy. For further information regarding Q Capital’s corporate policies and procedures, click here.

Q: Does Q Capital offer a rescission period?

A: Q Capital offers a recission period where required by law in accordance with such laws.

Q: Does Q Capital offer an escrow service, even in states where not required?

A: Yes. Once the purchase agreement is completed, the settlement amount is deposited in an escrow account until closing. Once papers are finalized, the escrow agent pays the seller.

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