Yes — a variable universal life policy serviced by SILAC can be sold in a life settlement, because you own the contract and a buyer purchases it from you; the carrier’s permission is not needed and the carrier does not get a vote. The question that actually determines the answer is whether the insured qualifies — typically a senior insured, a death benefit of $100,000 or more, and a policy that has been in force long enough to be past its contestable period.
A note on the name before anything else. SILAC Insurance Company of Salt Lake City is the former Equitable Life & Casualty Insurance Company, which took the SILAC name in 2020. Its business as of 2026 is dominated by fixed and indexed annuities, not life insurance, so a legacy life contract may be serviced through a specific unit or administrator. Confirm with the carrier which service center handles your policy and what its current financial strength rating is. Variable products are also registered securities, which means a VUL contract may have been sold through a broker-dealer and may be serviced separately from the fixed-product side.
This guide covers what makes variable universal life unusual in a settlement: the cash value moves with the market, so the number on your last statement is already stale. Pine Lake Life Solutions is not affiliated with, endorsed by, or acting on behalf of SILAC or Equitable Life & Casualty. Education only — not legal, tax, or investment advice.
In This Article
- What a Variable Universal Life Policy Actually Is
- The Charges That Quietly Drain a VUL
- Why Buyers Price the Death Benefit, Not the Subaccounts
- The In-Force Illustration Is the Single Most Important Document
- What to Gather and What the Process Looks Like
- Alternatives Worth Comparing Before You Sell
- Who Should Not Sell
- Frequently Asked Questions
What a Variable Universal Life Policy Actually Is
VUL combines a death benefit with an investment account. Your premium, after charges, goes into subaccounts that function much like mutual funds — stock funds, bond funds, money market options. The cash value rises and falls with those markets. Unlike a fixed universal life policy, there is generally no guaranteed minimum crediting rate protecting the account value from a bad decade.
That structure means the cash surrender value quoted this month is not the cash surrender value next month. If you are comparing a settlement offer against surrendering, you are comparing a fixed number against a moving one. Pull a fresh value before making any decision, and understand that any surrender charges still in effect come off the top.
The death benefit, by contrast, is stable. That is precisely why buyers focus on it.
The Charges That Quietly Drain a VUL
Every VUL carries a stack of internal costs, and they matter enormously to whether the policy survives to the insured’s actual life expectancy:
- Cost of insurance (COI). Deducted monthly from cash value and priced by the insured’s attained age. It rises every single year, and it accelerates steeply in the 70s and 80s.
- Mortality and expense (M&E) risk charge. An ongoing asset-based charge on the separate account.
- Fund-level expenses. Each subaccount has its own expense ratio, layered on top.
- Policy and administrative fees. Flat monthly charges regardless of performance.
- Surrender charges. Often present for the first decade or more.
The compounding problem is simple: when subaccount returns disappoint, the cash value shrinks while rising COI charges keep drawing from it. An underfunded VUL can reach a point where the account value cannot cover the monthly deductions, and the policy lapses unless you pay a much larger premium than you ever expected. Owners frequently discover this in their late 70s, decades after buying.
Why Buyers Price the Death Benefit, Not the Subaccounts
People often assume a life settlement offer is somehow anchored to the investment balance. It is not. A buyer is purchasing a future death benefit and taking on the obligation to keep the policy alive until it pays. The valuation inputs are the face amount, the insured’s estimated life expectancy, and the projected premium load — how much cash has to go in each year to prevent lapse.
Cash value enters the math in two indirect ways. It offsets near-term premium needs, because the account value can absorb some monthly deductions. And it sets the floor the offer must beat, since surrendering would put the net cash value in your pocket today. But a large subaccount balance does not automatically translate into a larger offer; sometimes it means the opposite, because the buyer must pay you more than surrender value to make the deal worth doing.
Published market research from the GAO (GAO-10-775) found sellers typically received roughly 10% to 35% of face value, and roughly four to eight times cash surrender value. Where a specific VUL lands depends on health, age, and the premium the policy demands going forward. Our page on how much you can get for a life insurance policy walks through the drivers.
| VUL Feature | Effect on You Today | How a Settlement Buyer Sees It |
|---|---|---|
| Subaccount balance (cash value) | Fluctuates with markets; sets your surrender payout | Offsets near-term premium; sets the floor an offer must beat |
| Death benefit (face amount) | Stable; what heirs would receive | The core asset being purchased |
| Rising cost of insurance | Drains cash value faster each year after age 70 | Raises projected carrying cost, lowering the offer |
| M&E and fund expenses | Ongoing drag on account growth | Factored into projected premium load |
| Surrender charges still in effect | Reduces what surrender would pay you | Often makes a settlement comparatively more attractive |
| Outstanding policy loan | Accrues interest; reduces death benefit | Deducted from settlement proceeds at closing |
The In-Force Illustration Is the Single Most Important Document
For a VUL, an in-force illustration is not a formality — it is the diagnostic. Request it from the servicing company and ask for multiple scenarios, because a VUL illustration is only as honest as its assumed rate of return:
- Current premium, assumed gross return of 0%. This shows when the policy lapses if the markets do nothing. It is the scenario most owners have never seen.
- Current premium, a modest assumed return. A realistic middle case.
- Premium required to carry the policy to age 95 or 100. This is the number a buyer cares about most.
Illustrations showing 8% or 10% assumed returns are marketing artifacts, not forecasts. Read what an in-force illustration is before you call, so you know exactly what to request and can recognize a useless version when one arrives.
What to Gather and What the Process Looks Like
To find out if the policy is a candidate, you need one page: the policy cover page showing the insurer, policy number, face amount, issue date, and insured. That is the starting point for a free review.
For a real offer, add the most recent annual statement, a current subaccount allocation summary, the in-force illustration described above, and disclosure of any policy loans or withdrawals — those reduce net proceeds at closing. You will also sign a HIPAA authorization so independent underwriters can estimate life expectancy from medical records.
Timing runs about 60 to 120 days end to end. The illustration and the medical records are the slow steps. When an offer arrives, get it in writing with both gross and net figures. Funds should sit with an independent escrow agent until the carrier confirms the ownership change; never sign over a policy against a promise to pay later. Most states then provide a rescission window during which you can unwind the sale.
Alternatives Worth Comparing Before You Sell
Selling is one of several exits, and it is not always the best one:
- Reallocate and keep it. If the policy is underfunded because of subaccount losses, shifting to more conservative options and increasing premium may stabilize it — if you still need the coverage.
- Reduce the death benefit. Many VUL contracts allow a face-amount reduction, which lowers the cost of insurance and can extend the policy’s life.
- Exchange it. A 1035 exchange into a different contract may make sense in some situations; this is a decision to make with a licensed advisor, not on your own.
- Surrender. Simple and immediate, but you receive only the net cash value after surrender charges — see how cash surrender value works.
- Life settlement. A lump sum for the whole contract, typically more than surrender for a qualifying policy, and premiums end permanently.
A comparison of settlement versus surrender is the right place to start. If you also hold SILAC guaranteed universal or group coverage, the math is different — see selling a SILAC guaranteed universal life policy or a SILAC group life policy.
Who Should Not Sell
Plain talk: if your spouse or a dependent still needs the death benefit and you can comfortably pay the premium, keep the policy. A settlement converts a future payout into present cash, and that trade only helps if you value the cash more than the coverage.
Selling also rarely works for policies below $100,000 in death benefit, for insureds who are young and healthy, or for contracts inside the two-year contestable period. If any of those describe you, a free review will say so in a few days and cost you nothing. Call (305) 209-7183 or send the policy cover page, and browse the education center in the meantime.
Frequently Asked Questions
Does the carrier have to approve the sale of my VUL policy?
No. You own the contract and may transfer it to a qualified buyer. The insurance company’s only role is administrative: recording the new owner and beneficiary once the transaction closes. It is not a party to your decision and cannot block it.
Why does my policy say Equitable Life & Casualty?
Because that was the company’s name before 2020, when Equitable Life & Casualty Insurance Company of Salt Lake City rebranded as SILAC Insurance Company. Older contracts still show the original name. Confirm with the carrier which service center handles your legacy life policy as of 2026.
My subaccounts lost value. Is my policy worthless now?
Not necessarily. Settlement buyers pay for the death benefit and estimated life expectancy, not for the investment balance. A VUL that has lost cash value but still carries a large face amount can still attract an offer — though the buyer will price in the higher premium needed to keep it in force.
How do I find out when my VUL will lapse?
Request an in-force illustration and ask specifically for a scenario assuming a 0% gross rate of return at the current premium. That shows the lapse date if markets do nothing. Also request the premium needed to carry the policy to age 95 or 100.
Will surrender charges reduce a settlement offer?
Surrender charges reduce what you would receive from surrendering, not from selling. Because they lower the surrender alternative, they often make a settlement look better by comparison. A buyer’s offer is based on the death benefit, life expectancy, and future premium cost.
What if I have a loan against the policy?
Outstanding loans and accrued interest come off the proceeds at closing, since the buyer takes the policy subject to that debt. Disclose any loan up front so the numbers you see are net. This is one of the most common surprises late in a transaction.
How long does the whole process take?
Typically 60 to 120 days from first review to funded payment. The in-force illustration from the carrier and the medical records for life-expectancy underwriting are usually the slowest steps. Keep paying premiums until the money is actually in your account.
Do I owe taxes on the money?
Some portion of settlement proceeds can be taxable depending on your cost basis, any loans, and your situation. Rules also differ if the insured is terminally or chronically ill. This is a question for a CPA or tax attorney, not a website.
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
- Cash Surrender Value Life Insurance
- How Much Can I Get For My Life Insurance Policy
- Life Settlement Vs Surrender
- Sell My Silac Guaranteed Universal Policy
- Education Center
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.