Three questions to ask before you accept any offer

The offer you receive is built almost entirely on one document: a life expectancy assessment prepared by a third-party medical underwriting firm. That firm reviews your medical records and produces an estimate of how long you are likely to live. The buyer uses that estimate to calculate what your policy is worth to them.

The question is who paid for it. If the buyer commissioned it, they chose the firm and they received the report before you did. You are entitled to a copy, and you should ask for one. If the estimate is shorter than your own doctor's view of your health, that is worth understanding before you sign anything.

You can also commission your own report from a different firm. It costs money and takes time, but on a large policy the difference between two estimates can be worth considerably more than the cost of the second opinion.

A life settlement involves at least three parties besides you: a broker who markets your policy to buyers, the buyer or fund that purchases it, and often a provider who acts as intermediary. Each is compensated. The question is how.

Broker commissions in this market typically run between 6% and 30% of the face value of the policy, depending on the state and the transaction. That is not a fee on the offer you receive — it is a fee on the death benefit, paid by the buyer out of their eventual proceeds. But it affects what buyers are willing to bid, which affects what you are offered.

Ask for a written disclosure of every fee, commission, and compensation arrangement before you accept. A licensed broker is required to provide this in most states. If anyone is reluctant to give it to you in writing, that reluctance is itself informative.

Most states give you a right to cancel a completed life settlement within a set period after signing — typically between 15 and 30 days, depending on where you live. This is your rescission right, and it is the last meaningful protection you have once the paperwork is done.

Ask for the exact number of days before you sign, not after. Know what triggers the clock — whether it starts on the date you sign, the date the buyer receives the documents, or the date the funds are transferred. These are not the same date.

If you are in Florida, the rescission period is 15 days. If you change your mind on day 16, the right is gone. This is not a technicality — it is the boundary of your ability to undo the transaction.