How far in advance of a policy lapsing does one normally have to spot and take action to save value in the policy?
The simple answer is about 2-to-12 months. Just like other financial investments or purchases, there is a lot of emotion involved (aka procrastination) in cutting one’s losses and selling a life insurance product, even when the policy in no longer needed or is an under-performing investment asset. If trusted advisors are willing and able to provide us with enough information to enable us to do so, on a fully privacy-protected basis, LSF is prepared to monitor policies to attempt to identify those policies that appear to be on the road to lapsing. When a life settlement appears to be an alternative, educational materials describing a life settlement can be presented for the policyowner to consider. Although this is not a time-consuming process, it often spans several months.
