Insurance companies usually have a policy for their agents that discourages suggesting that people sell their life insurance policy. Changes take place in peoples health that may affect them even being able to purchase another policy or the cost of another policy due to age may be far more expensive. There are companies that buy life insurance policies and encourage people who need cash to call and find out how much cash they can receive by having the company become the beneficiary. Advertising for these companies has increased dramatically.

This is tempting bait not only for people in a desperate financial situation – but for people that need cash for a family situation or for medical bills. One ad even shows the relief the policy holders feel (played by actors) when they realize they can now afford to pay for a wedding or travel they always dreamed of. The actors express how happy they are that they will be able to enjoy their retirement with the cash from their life insurance policy.

Unfortunately women tend to live longer than men and many policies are bought with that in mind when trying to provide for a wife after the husband passes. Once the policy is ‘cashed in’ the money frequently gets spent and the cushion that was planned when younger, disappears when it may be needed at the worst possible time. Hopefully people will think very carefully before accepting what may be seen as a life preserver when in a distress situation.