What is a policy owner allowed to do to receive a percentage of the policy's face value?

The policy owner is allowed to sell their policy to a Viatical Settlement Provider when they wish to receive a percentage of the policy's face value. A Viatical settlement involves selling a life insurance policy to a third party, typically in exchange for a lump sum that is less than the death benefit but provides immediate cash to the policyholder. This option is particularly relevant for policyholders who have a serious illness or are nearing the end of life, as it allows them to access funds that can be used for medical expenses or other needs.

This transaction does not involve transferring the policy to another insurer or canceling it for a refund, both of which would not provide access to a portion of the face value in the same manner. Taking a loan against the policy allows the owner to borrow funds using the policy as collateral; however, it does not equate to selling the policy and receiving a percentage of its face value outright. By choosing to engage in a Viatical settlement, the policy owner can effectively monetize their insurance policy.