Yes — a Delaware Life survivorship (second-to-die) policy can be sold in a life settlement when the contract and both insureds qualify, because a life insurance policy is transferable property and the carrier’s consent is not required. The carrier’s role is to produce the in-force illustration used in pricing and to record the ownership and beneficiary change once the sale funds.
Delaware Life Insurance Company entered the U.S. market by acquiring Sun Life Financial’s domestic annuity business in 2013 and today operates within Group 1001. Its product emphasis has been on annuities alongside life insurance, which means two things worth checking before you go further. First, confirm that the contract in your file is life insurance rather than an annuity — annuities cannot be sold in a life settlement. Second, if it is life insurance, confirm which entity issued it, since older contracts in this lineage may carry a predecessor company’s name. Both answers are on the contract itself and on your latest statement; verify with the servicing company as of 2026.
From there this guide covers how joint-life valuation works, what the first death does to the number, the trustee’s role when an ILIT owns the policy, and the cases where keeping or surrendering is honestly the better call. Pine Lake Life Solutions is not affiliated with Delaware Life, Group 1001 or Sun Life Financial, and nothing here is legal, tax or investment advice.
In This Article
- First, Confirm You Are Holding Life Insurance
- Then Pull the Numbers That Actually Drive the Decision
- Why Two Insureds Means a Lower Percentage of Face
- Signs the Policy Has Outlived Its Purpose
- What the First Death Does to Market Value
- Trust-Owned Policies, Contestability, and Size
- Starting a Free, No-Obligation Review
- Frequently Asked Questions
First, Confirm You Are Holding Life Insurance
Life insurance and annuities sit in the same drawer and are constantly confused. A life insurance cover page states a face amount or death benefit and names an insured — two insureds on a survivorship contract. An annuity states a contract value or account value, names an owner and an annuitant, and typically shows a surrender charge schedule.
Watch for the phrase “joint and survivor.” On an annuity that describes an income election continuing payments to a surviving spouse; it does not make the contract second-to-die life insurance. If the paperwork references subaccounts, index crediting strategies tied to an accumulation value, or guaranteed withdrawal or income benefits, you are most likely looking at an annuity.
Only life insurance can be sold in a life settlement. If the contract turns out to be an annuity, a reputable reviewer will say so and stop. See how the two products differ and selling an annuity versus a policy.
Then Pull the Numbers That Actually Drive the Decision
Ask the servicing company for one written package: current face amount and any scheduled change; account value and cash surrender value; the exact loan balance and its interest rate; complete premium history including any lapse and reinstatement; whether any no-lapse or secondary guarantee remains intact; and the in-force illustration at both current and guaranteed assumptions.
Add the question that matters most on a second-to-die contract: what premium is required to carry this policy to the later of the two life expectancies? That number, not what you have been paying, is the real cost of holding the asset. On a universal chassis, monthly cost of insurance charges climb with both insureds’ attained ages and continue while either is alive, so the required outlay in later years can dwarf the early premiums.
If the illustration shows the account value going to zero while both insureds are projected to be living, the policy is on a lapse track. That single finding reframes the whole comparison. See what the illustration should contain and alternatives to simply stopping premiums.
Why Two Insureds Means a Lower Percentage of Face
A survivorship policy pays only after both insureds have died, so a buyer must underwrite two lives and combine them into a joint-and-last-survivor curve. Because the probability that both people have died accumulates slowly, the expected payout sits far out.
Two effects follow: the buyer funds premiums across more years, and the eventual benefit is discounted more heavily. Together they push the offer below what a comparable single-life policy would command as a share of face value. Published payout ranges mostly reflect single-life cases, so calibrate expectations to the low end.
Fewer buyers also participate, because not every institutional funder models joint mortality. Thinner bidding means less upward pressure on price, which argues for shopping the case properly and requiring written offers with all compensation disclosed. See how buyers price policies and questions to ask before signing.
| Checkpoint | What good looks like | What should stop you |
|---|---|---|
| Contract type | Life insurance with a stated face amount | An annuity contract value and annuitant |
| Policy status | In force, past contestability | Lapsed, or reinstated within two years |
| Face amount | $100,000 or more | Small final-expense-scale coverage |
| Premium outlook | Known cost to the later life expectancy | Illustration you have never actually seen |
| Offer documentation | Written, with compensation disclosed | Verbal promises before underwriting |
| Funds handling | Independent escrow until transfer recorded | Ownership transferred before payment |
Signs the Policy Has Outlived Its Purpose
Second-to-die coverage was purchased to solve a problem at the second death. When that problem is gone, the premium remains. Common triggers: the estate is no longer taxable after changes in federal exemption levels (confirm current thresholds with a tax advisor as of 2026, and check state estate or inheritance taxes, which apply at much lower levels in several states); the ILIT has become pure administration; a business succession or buy-sell agreement has already been executed; or heirs are financially independent while the premium strains a fixed income.
Where the money is needed for care rather than legacy, the mismatch is the point: the benefit is payable at the second death, and the care bills are monthly. See funding an assisted living move. None of this makes selling automatic — it makes a side-by-side comparison necessary.
What the First Death Does to Market Value
When one insured dies, the joint curve collapses into a single life on the survivor. The buyer underwrites one mortality, the expected payout moves closer, and the premium burden drops. The same face amount often commands a materially better offer than it did before.
Sequence: report the death to the servicing company, request an updated in-force illustration reflecting the change, ask whether the contract carries a policy split option or a provision responding to estate tax law changes, and then compare selling, surrendering and keeping. Do not lapse the policy on the assumption that a survivorship contract which paid nothing at the first death is worthless — the opposite is usually true. Read the first-death guide.
Trust-Owned Policies, Contestability, and Size
Where an irrevocable life insurance trust owns the contract, the trustee is the seller. The trustee signs, the trust receives the proceeds, and the trust document governs distribution. A prudent trustee documents the carrying cost, the surrender value confirmed in writing, the offers received, and the reasoning, and checks the instrument for beneficiary notice, consent or court-approval requirements. Expect requests for the trust agreement and amendments, evidence of trustee authority, the trust EIN, and the Crummey notice file supporting annual-exclusion treatment of premium gifts.
The universal gates: the policy must be past its two-year contestability period, measured from issue or from any reinstatement, and the face amount generally needs to reach $100,000 or more. Small final-expense-scale contracts from any carrier rarely attract offers at all; for those, surrender value or a reduced paid-up option is the practical comparison. Where a policy qualifies, GAO research (GAO-10-775) found sellers typically received about 10% to 35% of face value, averaging roughly four to eight times cash surrender value, with survivorship cases at the low end. More: selling a trust-owned policy.
Starting a Free, No-Obligation Review
Send the cover page of the contract. If it is an annuity, you will be told so and no settlement process begins. If it is a survivorship life policy, the cover page — issuing company, policy number, face amount, issue date and both insureds’ names — is enough for a specialist to say whether it is a realistic candidate.
If the case advances, plan on 60 to 120 days: HIPAA authorizations and medical records for both insureds, independent life expectancy reports, the in-force illustration, written offers with all compensation disclosed, contracts, and independent escrow holding funds until the carrier records the ownership change. Most states then provide a rescission window that allows a seller to unwind the transaction.
To begin, send the cover page or call Pine Lake Life Solutions at (305) 209-7183. Pine Lake is not affiliated with Delaware Life. If you also hold a Delaware Life universal life contract, see the Delaware Life universal life guide.
Frequently Asked Questions
How do I know my Delaware Life contract is life insurance and not an annuity?
The cover page tells you. Life insurance states a face amount or death benefit and names an insured, or two insureds on a survivorship contract. An annuity states a contract or account value, names an annuitant and shows a surrender charge schedule. Only life insurance can be sold in a life settlement.
My annuity offers a joint and survivor option. Is that second-to-die coverage?
No. That election continues income payments to a surviving spouse and is a payout feature of an annuity, not a life insurance death benefit payable at a second death. If the paperwork mentions subaccounts or guaranteed withdrawal benefits, it is almost certainly an annuity.
Does Delaware Life have to approve a life settlement?
No. The owner of a life insurance policy may transfer it, a right confirmed by the Supreme Court in Grigsby v. Russell in 1911. The carrier issues the in-force illustration and records the ownership change after closing. Pine Lake Life Solutions is not affiliated with Delaware Life.
What is the most important number to obtain?
The premium required to carry the policy to the later of the two life expectancies, taken from an in-force illustration run at both current and guaranteed assumptions. It is the true cost of holding the policy and frequently differs sharply from what you have been paying.
Why do second-to-die policies sell for less?
Payment waits for the second death, so a buyer models a joint-and-last-survivor curve, funds premiums for more years, and discounts the benefit from further in the future. Fewer institutional buyers underwrite joint mortality, so the case attracts fewer competing bids.
Is the policy worth more after one insured dies?
Usually yes. The contract becomes economically a single-life policy on the survivor, which buyers underwrite more readily and value closer to payout. Report the death, request an updated illustration, and have the policy reviewed before considering surrender.
Our trust owns the contract. What does the trustee need to do?
Sign as seller, receive the proceeds for the trust, and document why selling serves the beneficiaries better than keeping or surrendering. The trustee should also confirm whether the trust requires beneficiary notice, consent or court approval before acting.
How do I get a free review?
Send the cover page of the contract. If it is an annuity you will be told so and nothing further happens; if it is a survivorship life policy, that page supports a free, no-obligation assessment of candidacy. Call (305) 209-7183 with questions.
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Related Reading
- Can I Sell A Survivorship Life Policy
- Survivorship Policy First Death
- Sell My Delaware Life Universal Life Policy
- Life Settlement Vs Annuity
- Life Settlement Vs Selling An Annuity
- What Is An In Force Illustration
- Stop Paying Premiums Alternatives
- Sell Ilit Trust Owned Policy
- Life Settlement Questions To Ask Before Signing
- Sell Policy Assisted Living Move
Pine Lake Life Solutions does not purchase life insurance policies and does not provide legal, tax, or investment advice. Information provided is for educational purposes only. Eligibility for any option, including life settlements, is not guaranteed and depends on individual circumstances, policy terms, underwriting, and market conditions. Consult independent legal, tax, or financial professionals before making decisions regarding a life insurance policy.