Life Expectancy - What Is It And How Does It Work?
Posted by The Policy Settlement Alliance on Fri, Jul 30, 2010 @ 09:36 AM
By Ronald C. Kerstetter
Life expectancy studies, which may be referred to as LE's are done for insured when a life settlement is being considered. A LE study is preformed by actuaries and medical professionals as a means of helping determine the amount of months an insured will live. Though it sounds morbid, we must remember that a policy’s value is very dependent on the LE study, in addition, the insurance company, policy type, policy values and policy premiums or cost also factor into the final offer you are made on the settlement of your policy. That being said, life expectancy is one of, if not the biggest factor in determining the value of your policy. The shorter the LE of the insured, the greater the value of the insurance policy being offered for settlement.
A LE study is performed by compiling the insured’s medical history both through a questionnaire and a review of doctor’s records and medical history.
For the most part a life expectancy study is unobtrusive and requires very little participation on the part of the insured. A HIPPA form is signed and a settlement application with medical history and RX profile is submitted by the life settlement broker. Thereafter, the medical records and RX information is compiled by the firm doing the LE study.
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