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A viatical settlement is a contractual agreement to provide a life insurance policyholder immediate cash in exchange for the sale and transfer of life insurance policy ownership rights.
Settlement Options and Illustrations. SETTLEMENT OPTIONS Death proceeds of a life policy can be paid out in five different options: lump-sum, fixed amount, fixed period, interest only, and life income. a. Lump-sum - Although this option is still available it is not used as frequently as the others. b.