Sell Your Life Insurance Policy in Michigan Through a Life Settlement
Michigan regulates viatical settlements but not most senior life settlements. Trust Life Settlements explains which rules apply to you, shows every offer in writing, and charges a published Flat-Fee.
Can I Sell My Life Insurance Policy in Michigan?
Michigan's manufacturing and automotive history produced generations of retirees across Detroit, Grand Rapids, Lansing, Flint, and Traverse City, many of whom also bought individual permanent life insurance. Michigan is unusual in regulating only viatical settlements, which leaves most senior life settlements outside a dedicated statute.
For many Michigan retirees, a life insurance policy outlives its purpose once the mortgage is paid and the children are grown. Rising premiums can make it tempting to surrender or lapse the coverage. A life settlement lets you sell the policy to an institutional buyer instead, receiving a lump sum while the buyer takes over the premiums.
Whether your sale is a viatical settlement under Michigan law or a life settlement under general law depends on the insured's health. That distinction determines which disclosure and cancellation rules apply, so we confirm it at the start.
Michigan Life Settlement Regulations
Michigan does not have a dedicated life settlement act. Insurance matters in the state are overseen by the Michigan Department of Insurance and Financial Services, and general insurance and consumer protection laws apply.
Settlement Statute
No
Licensing Required
No
Disclosure Required
Yes
Rescission Period
Viatical only
What Michigan Policyholders Should Know
Michigan regulates viatical settlements — sales by terminally or chronically ill policyowners — under Public Act 386 of 1996 (MCL 550.521–550.528).
Michigan does not have a broader life settlement act for healthy seniors, so most senior settlements fall under general contract and insurance law.
For viatical settlements, the seller can void the contract for at least the shorter of 30 days after signing or 15 days after receiving payment (MCL 550.524).
The viatical act also requires specific disclosures to the seller by the time the contract is signed (MCL 550.523).
What Your Policy May Be Worth in Michigan
Offers often exceed the policy's cash surrender value
Actual amounts depend on age, health, policy type, death benefit, and future premium obligations. Request a free policy review for a personalized assessment.
Viatical Settlement or Life Settlement? Why It Matters in Michigan
If the insured has a terminal or chronic illness, the sale is a viatical settlement and Michigan's Act 386 applies, including required disclosures and a guaranteed right to void the contract.
If the insured is an older adult without a serious diagnosis, Michigan has no settlement-specific law for the sale. The same safeguards can still be part of your transaction — they just depend on the contract and on who represents you.
Who May Qualify for a Life Settlement in Michigan?
Life settlement eligibility is case-specific and depends on multiple factors. Institutional buyers evaluate each policy individually, considering:
Age and life expectancy of the insured
Current and anticipated health status
Policy type and death benefit amount
Annual premium cost and future obligations
Policy economics and cash surrender value
Conversion privileges (for term policies)
Current buyer demand for comparable policies
Remaining premium-paying period
There is no guarantee of qualification or a specific offer amount. Each case is evaluated on its own merits.
What Types of Life Insurance Policies Can Be Sold in Michigan?
Depending on the specific facts, several types of life insurance policies may potentially qualify for a life settlement in Michigan:
Universal Life
Including indexed and variable
Whole Life
Traditional and participating
Convertible Term Life
With active conversion privilege
Survivorship / Second-to-Die
Where appropriate
Not every policy type is automatically marketable. Eligibility depends on the individual policy's economics and buyer demand.
Can I Sell a Term Life Insurance Policy in Michigan?
A term life insurance policy may have settlement value in Michigan if it includes a conversion option that allows conversion to permanent coverage and the transaction economics support a settlement. The conversion privilege is what gives the policy value to institutional buyers — pure term policies without conversion options generally do not qualify. If you hold a convertible term policy, contact us to discuss whether your conversion window and policy characteristics may support a life settlement.
Michigan Life Settlement Broker Fees: Flat-Fee vs. Percentage Commission
Many traditional life settlement brokers use percentage-based compensation that may equal approximately 20%–30% of settlement proceeds, depending on the broker, transaction, and applicable requirements. With a percentage-based model, the higher your settlement offer, the more you pay in broker fees.
Trust Life Settlements uses predetermined fixed-dollar tiers rather than calculating brokerage compensation as a percentage of settlement proceeds. The settlement amount determines which of Trust's five Flat-Fee tiers applies. This structure is disclosed in writing before you commit and paid from settlement proceeds at closing — never out of pocket.
Trust Life Settlements Five-Tier Flat-Fee Schedule
| Settlement Offer / Proceeds | Flat-Fee |
|---|---|
| $0 – $100,000 | $6,000 |
| $100,001 – $250,000 | $15,000 |
| $250,001 – $500,000 | $30,000 |
| $500,001 – $750,000 | $45,000 |
| $750,001+ | $60,000 |
Maximum fee: $60,000. Fees are paid from settlement proceeds at closing — never out of pocket. View full pricing details
Michigan Life Settlement Broker vs. Provider: What's the Difference?
Life Settlement Broker
Represents the policyowner in seeking competitive offers from multiple institutional buyers. A broker's role is to advocate for the seller, present all offers in writing, and provide transparent disclosure of compensation and all bids received.
Life Settlement Provider / Buyer
Operates on the purchasing side of the transaction. Providers evaluate policies and submit offers to acquire them. When a policyowner works directly with a single provider, they may not see competing offers from other institutional buyers.
Trust Life Settlements acts as the policyowner's broker and does not purchase policies for its own account. We represent the seller — not the buyer — seek competitive offers from more than 20 institutional providers, present all bids in writing, and charge a transparent Flat-Fee rather than a percentage commission.
How to Sell a Life Insurance Policy in Michigan
Free Review
Contact us for a no-obligation policy review. We evaluate your Michigan policy economics and preliminary eligibility.
Medical Records
With your authorization, we gather medical records and policy details to help institutional buyers evaluate your case.
Competitive Bidding
Your case is submitted to more than 20 institutional life settlement buyers. All offers are presented to you in writing.
Close & Get Paid
Review, accept, and close. Viatical settlements carry Michigan's statutory right to void; for other sales, we review the contract's cancellation terms with you.
Michigan Life Settlement FAQ
Does Michigan regulate life settlements?
Only partly. Michigan's Viatical Settlement Contracts Act covers sales by people who are terminally or chronically ill. A typical senior life settlement, where the insured is not seriously ill, is not covered by a Michigan settlement-specific statute.
What is the difference between a viatical and a life settlement in Michigan?
A viatical settlement involves an insured with a terminal or chronic illness and falls under Michigan's viatical act, including its disclosure and cancellation rules. A life settlement usually involves an older insured without a terminal diagnosis and is handled under general law.
How long do I have to cancel a viatical settlement in Michigan?
Michigan requires that the seller be able to void a viatical settlement for at least the shorter of 30 days after signing or 15 days after receiving the settlement payment. For other life settlements, check the contract's rescission terms.
Can I keep part of my coverage when I sell in Michigan?
Some buyers offer a retained death benefit, where you sell the policy but keep a smaller amount of coverage for your beneficiaries. It lowers the cash you receive, and availability depends on the buyer and the policy.
What would a Michigan Flat-Fee example look like?
Hypothetically, a $900,000 settlement offer falls in Trust's top tier, so the broker fee is capped at $60,000 and $840,000 remains before other costs and taxes. A broker charging 25% would take $225,000 of the same offer. This is an illustration only, not a guarantee of any offer.
Have more questions? View our full FAQ or get in touch.
Sources
- Michigan Legislature — Act 386 of 1996 (Viatical Settlement Contracts)
- Michigan Department of Insurance and Financial Services
- LISA — State Regulations Overview
Last reviewed September 2026. This page is general information, not legal or tax advice.
Before You Surrender or Lapse Your Policy, Find Out What It May Be Worth
Request a confidential policy review for your Michigan policy. We disclose every offer and our fee in writing before you commit.