Viatical Settlement
An arrangement where a person with a terminal or severe chronic illness sells their life insurance policy to a third-party company for a lump-sum payment that is less than the policy's death benefit.
Detailed Explanation
The company takes on the role of beneficiary and collects the death benefit upon the insured's passing.
Practical Example
Sarah, who had a terminal illness, decided to enter into a viatical settlement for her life insurance policy. She received a lump sum of cash that she could use to cover her medical expenses and enjoy her remaining time.
Frequently Asked Questions
Related Terms
Need Insurance Coverage?
Request quotes from top insurance providers and find the best coverage for your needs.
Get Free Quotes