Frequently asked questions
ABOUT MASON FINANCE
Mason Finance is a venture-backed financial technology company based in San Francisco, California. We were founded on the idea that retirees deserve better access to information and financial products that enable them to sustain their retirement. Currently, we focus on life settlements, helping people sell their life insurance policies for more than the surrender value.
Currently, Mason Finance helps people sell their life insurance policies in a transaction formally known as a life settlement. We streamline paperwork and buy policies directly, shaving months off the process and eliminating broker’s fees and commissions. We also purchase policies as low as $50,000 in face value, making life settlements available to a wider audience.
DO I QUALIFY?
There are two routes of qualification that help us determine who is eligible for a life settlement. First, we look at the policy: type of policy, size or face value, cash value (if any) and premium schedule. Secondly, we consider the health and age of the insured. Medical underwriting is performed either with a health questionnaire (if you qualify for an expedited process) or by gathering recent medical records.
Regardless of your residence, you can use our online life settlement calculator to get a quick estimate of what your policy is worth. Mason Finance is a licensed life settlement provider in 12 states, with more states pending. We have partnered with Abacus Life Settlements to purchase policies in the states we’re not yet licensed in.
Generally, people selling their life insurance are over the age of 65, but this can vary. For viatical settlements, the age of the policyholder matters less than the life expectancy. There is no defined rule, so check out the life settlement calculator to see if you qualify.
Certainly not. Our investors are looking for a 10-12 year investment period, which is why 78 is the average age for a qualified candidate. On average, a healthy 78-year-old can expect to live within that 10-12 year holding period. This means that you can be 80 and healthy and qualify. For people younger than 78, health status matters more.
POLICY TYPES AND FEATURES
Most permanent products qualify such as whole life or universal life policies. For most other types of policies, qualification is case-by-case. Group policies do not qualify unless the insured can be transferred out of the group.
Depending on your specific policy and current health status, you may be eligible to sell your term life policy. Term policies that are convertible typically qualify for a life settlement. Nonconvertible term policies typically qualify only when the insured has a life-threatening condition.
This means that while your policy is still within its “convertibility period,” it can be converted to a permanent product, such as a whole life policy or a universal life policy.
Group plans work if the policy can be transferred out of the group – we currently are unable to work with policies that are simply assignable (but not transferable).
No. We cannot process settlements for FEGLI policies.
Yes, however, policies in grace are harder to sell. Your carrier may restrict your ability to request the information we need to accurately price an offer until you make a payment.
Unfortunately not– policies smaller than $50,000 are not eligible for a life settlement.
While we can work with multiple policies for one customer, each one has to have a face value of $50,000 or more in order to be eligible to be sold.
ESTIMATES AND OFFERS
Estimates are calculated using limited and simplified information, such as your policy size and the health and age of the insured. An offer is made after gathering more details on these things: policy features, premium schedules, and medical underwriting on the insured.
Your estimate is an average based on very limited information on the policy and the insured — all we know is the size of the policy and the age and health of the insured. The estimate given is a rough average. Each case is different and there is a chance that a final offer would differ greatly from the estimate.
The average payout for a life settlement is about 22% of the death benefit, but this number varies greatly! Your payout entirely depends on your specific circumstances: policy features, premium schedule, and the health and age of the insured.
How long you’ve had the policy and how much you’ve paid into it does not affect your offer amount.
DETAILS ABOUT LIFE SETTLEMENTS
Life settlements are a great opportunity to convert your life insurance policy into immediate cash. If you can no longer afford your life insurance premiums, need money to pay for medical bills and other expenses, or just want more money to enjoy your retirement, life settlements could be a great option for you. That said, life settlements are not for everyone. If you sell your policy, you will no longer be eligible for certain tax benefits associated with life insurance and your family will no longer receive the payout upon your death.
Life settlements are taxed in three tiers.
- Proceeds received up to the tax basis are free of income tax.
- Proceeds received that are greater than the tax basis up to the amount of the cash surrender value are taxed at ordinary income rates.
- Proceeds received that are in excess of the cash value get taxed as capital gains.
This blog post offers a deeper explanation, but you should consult your own tax, legal, and accounting advisors before engaging in any transaction.
The money given by an insurance company to a policyholder once they choose to terminate their policy is known as the cash surrender value. This value is generally far less than the value the policyholder would have received through a life settlement.
Have more questions?
Whether you have a question about our services, need assistance or just want to talk, we want to hear from you.
Contact our support team.