Yes — a variable universal life policy can be sold in a life settlement if you and the policy qualify, and that holds for any carrier’s VUL, including one written or administered under the Reliance Standard name. The contract is your property. The buyer purchases it from you, the carrier’s permission is not required, and the company is not a party to your decision.
Worth establishing up front: Reliance Standard Life Insurance Company, based in Philadelphia, is primarily a group employee-benefits carrier — group life, disability and voluntary products distributed through employers. It became part of the Tokio Marine group when its parent Delphi Financial Group was acquired in a transaction announced in 2011 and completed in 2012; verify the current structure and A.M. Best rating with the carrier as of 2026. Individual permanent life is a small share of that book, and variable products are securities administered through a broker-dealer, so confirm with the carrier exactly which contract you hold and which entity issues and services it.
Whatever the letterhead, the settlement analysis on a VUL is consistent: buyers pay for the death benefit and the cost of carrying it, not for how your subaccounts performed. Pine Lake Life Solutions is not affiliated with, endorsed by, or acting on behalf of Reliance Standard.
In This Article
Where the Money Actually Sits
In a variable universal life policy your cash value is invested in separate-account subaccounts — investment options that behave much like mutual funds. They are held apart from the insurer’s general account, and their value moves with the markets every business day.
Two consequences follow. There is normally no guaranteed floor under the account value unless you have shifted money into a fixed option. And any surrender value you were quoted is a snapshot, not a standing number. If you are weighing a surrender against a settlement offer, ask for a same-day value; the figure on a statement from last quarter is already stale.
M&E, Cost of Insurance and Fund Fees
Three separate costs pull against the account every month, and together they explain why so many VUL policies fall behind the illustration used to sell them.
The mortality and expense risk charge is a percentage of separate-account assets the insurer deducts for insurance risk and administration. The cost of insurance is the monthly charge for the death benefit itself, priced on the insured’s current age — it rises every year and accelerates sharply past 75. And each subaccount carries its own fund management fee underneath everything else.
In strong markets with a well-funded policy these disappear into the returns. In flat markets, or once the insured is in their late seventies, the rising cost of insurance is paid out of principal. A smaller account then generates smaller returns, which makes the next year worse. That compounding drag is what turns a VUL into a lapse candidate.
What the Buyer Is Really Purchasing
This is the point that changes most people’s thinking: a settlement buyer is not buying your investment performance. After a sale the buyer typically restructures how the policy is funded and pays only what is needed to keep the death benefit in force.
So the offer turns on the death benefit, the insured’s age and health, and the projected premium load required to carry the contract — sometimes called the cost to carry. A VUL with a disappointing account balance and a full death benefit can still be a solid candidate. Weak fund performance did not destroy the policy’s value to a buyer; it damaged the policy’s ability to sustain itself, which is usually why the owner started looking in the first place. Our overview of what a policy can bring sets expectations.
| What You Might Assume | How Buyers Actually See It |
|---|---|
| My subaccounts lost money, so the policy is worthless | Value comes from the death benefit and cost to carry, not fund performance |
| A big account balance means a bigger offer | It mainly lowers the buyer’s future premium; it also raises the surrender floor |
| The surrender value on my statement is the number to beat | It moves daily; request a same-day figure before comparing |
| The offer should be close to the death benefit | Typical range is 10–35% of face value (GAO-10-775) |
| M&E charges are minor | They stack with rising cost of insurance and fund fees to drain an underfunded policy |
Ask for Illustrations at More Than One Return
Because a VUL’s future depends on assumptions, one in-force illustration is not enough. Request projections at a moderate assumed return, at a low return, and at 0% if the carrier will run it. The 0% version is the honest stress test: it shows how long the policy survives if the markets never help again.
Ask two specific questions for each scenario — in what year does the policy lapse at my current premium, and what premium carries it to age 100? Our guide to reading an in-force illustration explains which columns to trust. Bring those runs to any review; they shorten the conversation considerably.
Things That Complicate a VUL Sale
A few VUL-specific items are worth surfacing early rather than at closing.
- Surrender charges. Many VUL contracts impose them for the first ten to fifteen years, which suppresses surrender value further and makes the settlement comparison one-sided during that period.
- Policy loans. Loans taken against a variable policy are repaid from sale proceeds at closing and reduce your net.
- Tax basis. Gains, basis and modified endowment contract status all matter to how proceeds are treated. This is a CPA conversation, not a guess.
- Securities paperwork. Because variable policies are securities, the servicing chain can involve a broker-dealer, which sometimes adds time to document requests.
Alternatives Worth Weighing First
Selling is one option among several. Reallocating subaccounts to something more conservative can steady the account but will not stop rising insurance charges. Reducing the death benefit lowers the monthly cost of insurance and can make the policy self-sustaining again — genuinely the most underused fix in flexible-premium contracts. Adding premium now costs far less than repairing a nearly empty account later. Surrendering ends coverage and pays the current value less any surrender charge.
And a life settlement pays a lump sum, typically 10% to 35% of face value according to the federal GAO study (GAO-10-775), with coverage ending at closing. Use is a life settlement worth it to frame the trade-off against your own situation.
Process and Timing
Begin with the policy cover page alone — carrier, policy number, face amount, issue date, insured’s date of birth. That supports a free, no-obligation review. If it moves ahead: the current statement showing subaccount and surrender values, illustrations at multiple return assumptions, the full contract with prospectus and riders, any loan payoff figure, and health details for the life-expectancy reports.
Then 60 to 120 days from application to funded payment — authorizations, medical records, one or two independent actuarial life-expectancy reports, bids from licensed institutional buyers, acceptance, and closing through an independent escrow account with funds released once the carrier records the ownership change. Keep the policy funded the whole way; if the account value runs dry mid-process the contract can lapse and there is nothing left to sell. This page is educational only and is not legal, tax or investment advice.
Frequently Asked Questions
My VUL subaccounts are down. Can I still sell the policy?
Often yes. Buyers price the death benefit, the insured’s life expectancy and the premium needed to keep the contract in force, not the subaccount balance. Poor performance affects the policy’s ability to sustain itself, which is usually the reason owners look at selling.
What is the M&E charge on my policy?
The mortality and expense risk charge is a percentage of separate-account assets deducted by the insurer for insurance risk and administration. It sits on top of the cost of insurance and the underlying fund fees, which is why VUL costs more to carry than the illustration often suggested.
Why does the cost of insurance keep rising?
It is priced on the insured’s current age, so it increases every year and climbs steeply after 75. When investment returns do not cover it, the charge comes out of principal and the account value shrinks.
Is my quoted surrender value still good?
Not reliably. Variable cash value changes with the markets daily, and many VUL contracts also carry surrender charges in the early years. Ask for a same-day surrender figure before comparing it against any offer.
Does Reliance Standard write variable universal life?
Reliance Standard is best known for group employee benefits rather than individual variable products, and variable policies are securities administered through a broker-dealer. Confirm with the carrier which contract you hold and which entity issues and services it. The settlement analysis is the same regardless of issuer.
Would reducing the death benefit be smarter than selling?
It can be, if you still need some coverage. A lower face amount reduces the monthly insurance charge and may make the account self-sustaining again. If the coverage is no longer needed at all, a settlement generally returns more than surrender.
Does the insurance company have to approve the sale?
No. The policy is your property and the carrier’s permission is not required. It records the change of ownership and beneficiary after the transaction closes.
How do I start and how long does it take?
Send the policy cover page for a free, no-obligation review or call (305) 209-7183. The full process typically runs 60 to 120 days from application to funded payment, with funds held in independent escrow until the carrier confirms the transfer.
Find out what your policy is worth — free, confidential, no obligation.
A 15-minute educational review covers your eligibility, every alternative, and a realistic view of what each path would net you.
Related Reading
- What Is An In Force Illustration
- Is A Life Settlement Worth It
- How Much Can I Get For My Life Insurance Policy
- Cash Surrender Value Life Insurance
- Sell My Reliance Standard Universal Life Policy
- Sell My Reliance Standard Guaranteed Universal Policy
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.