Definition

1. Noun:
   • A viatical settlement is a financial transaction in which a person who is terminally ill sells their life insurance policy to a third party for a lump sum of cash. The seller receives immediate funds, while the buyer becomes the new policy beneficiary and assumes responsibility for future premium payments, ultimately receiving the full death benefit when the original policyholder dies.

Usage Examples

• Noun:
  • Facing mounting medical bills, he considered a viatical settlement to access the value of his life insurance.
  • The company specializes in purchasing life insurance policies through viatical settlements.
  • The cash from the viatical settlement provided her with financial comfort during her final months.

Advanced Usage

• "To enter into a viatical settlement": To complete the legal and financial process of selling one's life insurance policy under these circumstances.
  • After consulting with a financial advisor, she decided to enter into a viatical settlement.
• The term is often used in legal, financial, and insurance contexts to distinguish this specific transaction from other types of life insurance settlements or loans.

Variants and Related Words

• Viator (n): The terminally ill person who sells their life insurance policy in a viatical settlement.
• Life Settlement (n): A broader financial transaction similar to a viatical settlement, but typically involving a senior who is not necessarily terminally ill.

Synonyms

• Life insurance settlement (general)
• Accelerated death benefit (Note: This often refers to a provision within a policy itself, not a sale to a third party.)

Related Concepts (Not Phrasal Verbs)

• Beneficiary: The person or entity entitled to receive the death benefit from a life insurance policy.
• Death benefit: The lump-sum payment made by the life insurance company upon the death of the insured.
• Face value: The original, full value of the life insurance policy payable upon death.

Noun

1. sale of an insurance policy by a terminally ill policy holder
2. cash derived from sale of an insurance policy by a terminally ill policy holder