Viatical Settlement

Importance: 0.57

Is a company: no

Is a proper noun: no

Synonyms

  • cash lump sum
  • immediate payment
  • advance
  • in lieu of benefits
  • accommodation

Definition of Viatical Settlement

  1. A contract made between a terminally ill individual (known as the viator) and a third party whereby the third party agrees to buy the terminally ill person's life insurance policy at a steep discount for readably available cash. Also known as "viatication", "spin-life", a "transferrable insurance policy", or as a "life settlement", a viatical settlement is a viable option for those who lack the funds to continue paying their medical bills and wish to buy themselves a few more months or years.

Related Terms and Acronyms

  • Surrender Rights Definition,
    • The contractual right for a life insurance or annuity policyholder to cancel his or her policy.
  • Surrender Charge Definition,
    • A charge levied when a life insurance policyholder cancels his or her policy.
  • Financing Entity Definition,
    • An entity that purchases an insurance policy or settlement contract.
  • Living Benefits Definition,
    • The option for a life insurance policyholder to receive a portion of their death benefit in advance of their death.
  • Spin-Life Definition,
    • A financial industry that specializes in buying life insurance policies from individuals or convincing individuals to take out new life insurance policies with an investor as a beneficiary.
  • Stranger Originated Life Insurance (STOLI) Acronym,
    • A life insurance policy purchased by someone without any insurable interests with the insured person.
    Illegal in many Canadian provinces.
  • Policy Loan Definition,
    • A loan where a life insurance policyholder's death benefit is used as collateral.
  • Whole Life Insurance Definition,
    • Permanent life insurance with level premiums for the policyholder's entire lifetime.
  • Loss Payee Definition,
    • An entity that is legally entitled to the benefits of an insurance claim.
  • Accelerated Benefit Option Definition,
    • An option that allows the insured to receive insurance benefits before they would ordinarily be available.
  • Viator Definition,
    • A person who agrees to sell his or her life insurance policy to a third party.
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