Sell Your Life Insurance Policy in Florida | 2026 Life Settlement Guide

You bought a life insurance policy years ago. Maybe it was meant to protect your loved ones, your business, or your estate planning. Now your needs have changed. Premiums may be too high, the insurance coverage may no longer be relevant, medical bills have started to creep up, or you may simply value liquidity more than a future death benefit.

Many Florida residents are surprised to learn that they can sell a life insurance policy. These transactions, called life settlements, often yield significantly more than the policy's surrender value. Florida is one of the busiest life settlement markets in the country, and competition among buyers frequently leads to strong offers for policyholders.

Life insurance settlements are legal, regulated, and common in Florida. If your policy qualifies, exploring a sale may be financially worthwhile.

Is It Legal to Sell My Life Insurance in Florida?

Yes. Florida regulates life settlements under its insurance code. Life settlement providers must be licensed by the Florida Office of Insurance Regulation. The state maintains oversight to ensure transparency and consumer protection.

Florida law also gives policyholders a rescission period. You may cancel the contract within 15 days after receiving the proceeds.

If a company is not licensed in Florida, it cannot legally buy your policy. If approached by an unlicensed buyer, it is best to decline and verify their credentials with the Florida Office of Insurance Regulation.

Who Buys Life Insurance Policies in Florida?

Most buyers are institutional investors. These include pension funds, private equity firms, family offices, and dedicated life settlement funds. They purchase policies, via providers that are licensed in Florida, as financial assets that offer returns independent of stock market performance.

The structure is straightforward. You sell the policy and receive a lump sum. The buyer becomes the new owner and beneficiary, takes over all future premium payments, and collects the death benefit when the insured passes away. For the buyer, it is an actuarial investment. For you, it converts a future benefit into present-day cash.

Florida is especially active due to its large retiree population and prevalence of universal and whole life policies. Provider competition tends to be strong, which can translate into higher offers for residents.

Safety Concerns And The Hitman Question

Every once in a while someone asks the blunt question. If I sell my policy to a fund that gets paid when I die, does that put a target on my back?

It is a natural worry, but it does not line up with how this market actually works. For a deeper look at why this concern is unfounded, see our article on the "hitman" question.

Real buyers are regulated institutions. Think pension funds, asset managers, specialist life settlement funds, and family offices that live under compliance, audits and regulators. They buy large pools of policies, not one or two bets on a single person. Your policy is a tiny piece of a diversified portfolio. No one is sitting in a room watching your file and waiting for news.

More importantly, crime would completely destroy the investment. If someone were foolish enough to try something like that, the claim would be frozen, law enforcement would be involved, and the policy would become radioactive. The buyer would lose their capital, their license and their business, and the people involved would be looking at serious prison time. That is the exact opposite of what professional investors want.

There are plenty of real risks in life. Selling a policy through a regulated life settlement process does not meaningfully change your exposure to violent crime. The buyer wants a clean, boring actuarial outcome, not drama. If this were a real world problem you would see patterns of cases and headlines over the last few decades. You do not, because serious firms do not play games with that line.

If this worry is on your mind, it is better to treat it as something to acknowledge and then put aside, not as a deciding factor in whether to explore a settlement.

Retained Death Benefit And What Happens If The Buyer Stops Paying

In some transactions, the policyowner do not sell the entire policy for a one-time payout. Instead, you take part in cash today and keep a slice of the future death benefit. That structure is usually called a retained death benefit. The buyer agrees to carry the full premium load and, when the insured passes away, your family gets the retained portion without ever having to write another check.

The obvious follow up question is what happens if the fund or buyer stops paying premiums in ten years. If the policy lapses, your retained benefit disappears with it. That is a real risk, and it belongs in the contract, not swept under the rug.

Well structured deals handle this with clear protections. Common approaches include giving you the right to step in and assume the policy if premiums are not paid on time, or if the fund winds down or fails. In practice that can mean a clause that says if premiums are not funded by a certain date, ownership can revert or you can elect to take over and keep the policy in force by paying premiums yourself. Serious buyers also use professional servicing companies and advance notice requirements so you, your adviser, or your lawyer get notified long before coverage is at risk.

The point is that you do not have to simply hope the fund behaves. You can ask, in plain language, what happens if premiums are not paid, when you are notified, and what your rights are to step back in. If you are doing any kind of retained death benefit, those answers should be written into the settlement documents before you sign, so your family is not relying on a handshake twenty years from now.

How Much Is My Life Insurance Policy Worth in Florida?

Valuation depends on age, health (terminal illness vs healthy insured obviously makes a big difference), policy type, face value, and premium requirements.

General range for qualifying policies: Many Florida policyholders over age 65 with policies of 100,000 dollars or more receive offers between 10 and 60 percent of the death benefit, depending on the details.

Example scenarios based on current market patterns:

Illustrative examples; may not reflect the value of your policy.

$2,300,000 universal life policy, age 78 year old female with CHF and hypertension

• Surrender value: $14,800
• Settlement offer: $325,000

$1.5 million universal life policy, age 87 year old male with mild arrhythmia and overall good prognosis

• Surrender value: $25,900
• Settlement offer: $415,000

$290,000 convertible term life insurance policy, age 74 male, history of melanoma

• Surrender value: $0
• Settlement offer: $124,000

Florida-specific considerations:

• Florida has no state income tax. Federal taxes may apply to gains above your cost basis.
• Florida is a competitive market, which often results in stronger pricing.
• Many life insurance companies represented in Florida are familiar to institutional buyers, which can streamline underwriting.

To get an estimate tailored to your policy, use the life settlement calculator.

Why Florida Residents Should Work With a Licensed Provider

Only licensed providers may purchase policies in Florida. Licensing ensures consumer protection, clear documentation, and regulatory accountability.

Licensed providers offer:

• Transparent written disclosures about various items, including pricing methods and fees
• Escrow protection so your funds are secure during closing
• Compliance with Florida's rescission rule
• A predictable, regulated process

Unlicensed buyers may offer uncertain pricing, inadequate documentation, or lack of recourse if issues arise. Licensing is your first safeguard.

Common red flags include unsolicited outreach, reluctance to share licensing information, unusually high offers, or pressure to sign quickly.

If in doubt, you can contact the Florida Office of Insurance Regulation to verify a company's status.

How the Process Works in Florida

Most transactions take 60 to 90 days from start to finish.

Next Steps for Florida Policyholders

1. Determine whether your policy qualifies
2. Request a valuation estimate
3. Consider requesting medical records in advance
4. Compare multiple offers
5. Review all terms carefully
6. Consult a CPA for tax implications
7. Confirm the provider's Florida license

Your policy is an asset. Understanding its value helps you make the best financial choice.

Disclaimer: The information provided in this article is for general informational purposes only and does not constitute legal, financial, or professional advice. Life settlement regulations vary by state, and this content should not be relied upon as a substitute for consultation with a licensed professional. Please consult with a qualified attorney, financial advisor, or licensed life settlement broker before making any decisions regarding the sale of a life insurance policy.