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As the economic crisis unfolds on a daily basis it is important to understand how the Life Settlement market and the value of life insurance policies are affected by these events. The value of a life insurance policy is guaranteed by law. Insurance companies are legally required to maintain enough cash reserves to pay off the death benefit of the policies they issue. Even in the case of AIG, there are enough cash reserves in place to cover all of the company’s outstanding policies. That money can not be touched for any reason other than to cover their active insurance policies. The volatility of the stock market and the drop in real estate values have absolutely no impact on life insurance polices or the reserves put aside to cover them.

In fact, for most people who own life insurance policies in the U.S. today, it may be the most stable asset they currently own. Their home and stock portfolios may be suffering significant losses in value, but their life insurance policy has not, and will not change in value. For those people looking to raise money to pay for their senior housing and long term care in today’s environment, liquidating a life insurance policy through a Life Settlement may very well be their best and only option. The demand for life insurance policies in the Life Settlement market is stronger than ever because insurance polices are disconnected from the economy and their value remains constant despite the current economic turmoil. The companies that purchase these policies are looking for stable investments over time; therefore the demand for these policies will most certainly continue to grow in the months ahead.

According to most economists, this economic crisis could result in a recession that will last well beyond 2009. Now more than ever, people need alternative funding solutions to help them move forward with the senior housing and care they need. While the current economic troubles run their course; Life Care Funding Group stands ready to help in anyway we can to educate seniors about this important financial option.

To learn more about the security of life insurance policies and the life insurance industry, click the links below:

Life Insurance Industry: Strong and Sound
Impact of Current Markets on Life Insurance
and Annuity Consumers: Questions Answered
Insurance Guaranty Associations: Frequently Asked Questions

The Benefits of a Life Settlement

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