The founder and president of American Life Fund Corp. in Atlanta, Georgia, Eugene E. Houchins III oversees a firm that assists clients with the liquidation of existing life insurance policies. Eugene E. Houchins III specializes in helping his clients understand the viatical settlement process, which can sometimes be rather complicated.
Viatical settlements and life settlements are the two most commonly used terms associated with the sale of existing life insurance policies. Viatical settlements and life settlements are slightly different, and policyholders should know what each type of settlement entails.
A viatical settlement is executed when an individual suffering from a chronic or terminal illness wishes to sell his or her life insurance policy, typically to pay for medical expenses while he or she is still alive.
A life settlement is used by relatively healthy seniors who have a longer life expectancy. Money from a life settlement allows policyholders and beneficiaries to spend their money any way they like and not necessarily for medical expenses.