Yes — a Unum universal life policy that you own can be sold in a life settlement. The contract is your property, a buyer purchases it from you, and Unum’s permission is not needed. Universal life is the type most often sold on the secondary market, because its structure produces the exact problem settlements solve: charges that rise with age, an account value that eventually cannot absorb them, and an owner who may no longer need the coverage.
Two Unum-specific checks come first. One, confirm you own a policy rather than hold a certificate — Unum Group is fundamentally a workplace benefits organization, built from the 1999 combination of UNUM Corporation (descended from Union Mutual, founded in Maine in 1848) and Provident Companies of Chattanooga (1887), and much of its life coverage is sold through employers. Two, confirm which licensed insurer issued it, since Unum Life Insurance Company of America, First Unum for New York, Provident Life and Accident, and Colonial Life are separate companies with separate service centers.
This guide explains how buyers price universal life, why the in-force illustration is the pivotal document, and when keeping or surrendering beats selling. Pine Lake Life Solutions is not affiliated with Unum or its subsidiaries.
In This Article
Ownership First: Policy or Certificate?
A settlement requires a contract you own and can assign. If your paperwork is a policy naming you as owner and premiums are billed to you directly, you are set. If it is a certificate of coverage tied to an employer’s master contract, the coverage is group-based and generally cannot be assigned or sold — that path runs through conversion, covered in our guide to selling a Unum group life policy.
Some worksite universal life is deliberately designed to be individually owned and portable, so the answer is not obvious from where you bought it. The reliable move is to call the service number on your premium notice and ask the carrier to confirm, in writing, the owner of record.
While you have them on the phone, ask which Unum entity issued the contract and where change-of-ownership forms and illustration requests should be directed. Getting that right up front saves weeks.
How Universal Life Quietly Gets Expensive
Universal life splits a policy into visible parts. Premium goes into an account value, interest is credited, and each month the insurer deducts charges — mostly the cost of insurance on the net amount at risk, plus administrative and rider fees. Coverage continues while the account value covers the deductions.
Cost of insurance is priced by age, so it climbs, slowly at first and then sharply after the mid-seventies. Combine that with the flexibility to underfund premiums in earlier years, and a familiar sequence unfolds: healthy account value in middle age, deductions overtaking credited interest, then a notice that additional premium is required to prevent lapse.
At that point owners believe they have two choices — pay or lose it. There are four: pay, surrender for the remaining cash value, lapse for nothing, or sell. Selling exists for the case where the coverage is no longer needed but the contract still has value to a buyer willing to carry it.
The In-Force Illustration Decides the Offer
An in-force illustration is the insurer’s own projection of your specific contract — future account values, charges, death benefit, and the premium required to keep it alive. Ask for two versions: one on current charges and crediting, and one on guaranteed maximum charges with minimum crediting. The distance between them is the risk in the policy.
Also request the run showing the minimum premium needed to carry the policy to maturity. That number is the buyer’s carrying cost, and it drives the offer as much as the death benefit does.
Order it in writing from the issuing Unum company, and verify the required authorization form and turnaround time as of 2026. Illustration delivery is frequently the longest single wait in a settlement, so starting early compresses everything after it.
| What Your Statement Shows | What It Means | Effect on an Offer |
|---|---|---|
| Rising monthly cost of insurance | Charges scale with the insured’s age | Higher carrying cost; often still sellable |
| Lapse warning or premium call | Account value no longer covers deductions | Common trigger to sell; act before lapse |
| Large cash surrender value | High floor a buyer must beat | Can compress the offer |
| Outstanding loan balance | Debt stays with the contract | Deducted from proceeds |
| Intact secondary guarantee | Benefit protected at a fixed premium | Predictable cost; attractive to buyers |
| Certificate rather than policy | Group coverage, employer-owned contract | Not sellable until converted |
What Buyers Are Actually Calculating
Four inputs. Face amount sets the ceiling. Life expectancy, estimated from medical records, sets the expected holding period. Required premium sets the carrying cost. Cash surrender value sets the floor, because no rational seller accepts less than the insurer would pay for a simple surrender.
Federal GAO research on the market (GAO-10-775) found sellers typically received about 10% to 35% of face value, on average roughly 4 to 8 times cash surrender value. Universal life policies that price well tend to share a shape: at least $100,000 of death benefit, an insured in their seventies or older or with a documented health decline, and premiums that have become uncomfortable.
The counterintuitive part: a UL policy in trouble often sells better than a heavily funded one, because a low surrender value leaves more spread. That is the reverse of what most owners expect. Our settlement versus surrender comparison works through it with numbers.
No-Lapse Guarantees and Secondary Guarantees
If your contract includes a no-lapse rider or secondary guarantee, the death benefit stays in force regardless of account value as long as a specified premium is paid on schedule. Buyers value that certainty, because the carrying cost stops being a moving target — no surprise cost-of-insurance increases, no lapse notices, a fixed obligation.
The flip side is that these guarantees are unforgiving. A late or short payment can reduce or void the guarantee, sometimes permanently, even if the account value looks fine. Before you make any decision, confirm from the in-force illustration whether your guarantee is intact and through what age it runs.
A broken guarantee is not a dead end. It simply means the policy is priced as standard universal life, with the buyer modeling rising charges rather than a fixed premium.
Loans, Documents, and Closing
Withdrawals permanently reduce account value and can reduce the death benefit; loans accrue interest and travel with the contract, and any balance is deducted from your proceeds — see how policy loans work. Get a current payoff figure so your comparison uses real numbers.
To begin, all you need is the policy cover page: insurer, policy number, face amount, issue date. That is what the free review runs on. If the policy is a candidate, add the latest annual statement showing account value, surrender value, loan balance, and monthly deductions, plus the in-force illustration.
Closing is an absolute assignment recorded by the insurer, changing owner and beneficiary. Expect 60 to 120 days overall. Insist on written offers, disclosed commissions from any broker in gross and net terms, and funds in independent escrow before you sign anything transferring ownership. Most states then allow a rescission period.
When Not to Sell
An honest comparison is worth more than a sales pitch. Keep the policy when a surviving spouse or a dependent with special needs still relies on the death benefit and you can sustain the premium. Keep it when an intact no-lapse guarantee locks in a manageable cost. And if the insured is terminally ill, check for an accelerated death benefit rider first — that can pay in weeks with no buyer, no escrow, and no third-party underwriting.
Surrender can also win. When the cash surrender value is modest — under roughly $15,000, for example — and the objective is a Medicaid spend-down, the speed and certainty of surrendering may outweigh a slightly larger settlement that takes months and requires medical records.
None of this is legal, tax, or investment advice. Tax treatment depends on cost basis, and federal rules for calculating basis on a policy sale changed in 2017; Medicaid rules vary by state. Bring in a CPA and an elder law attorney. For related types, see selling a Unum whole life policy, or call (305) 209-7183.
Frequently Asked Questions
Does Unum have to approve the sale of my universal life policy?
No. You own the contract and can sell it, a right the Supreme Court confirmed in 1911. The insurer records the change of owner and beneficiary once the transaction closes but does not approve or block it. Its own forms simply have to be completed correctly.
How do I know whether I own the policy?
A policy contract naming you as owner, with premiums billed to you directly, is individual coverage that can be sold. A certificate of coverage with payroll deductions indicates group coverage under an employer’s master contract, which generally cannot be assigned. Ask the carrier to confirm the owner of record in writing.
My policy says more premium is required or it will lapse. What now?
You have four options: pay the additional premium, surrender for the remaining cash value, let it lapse for nothing, or sell it in a life settlement. A lapse notice is a reason to request a free review immediately, since a lapsed policy is worth nothing to anyone.
Why do buyers insist on an in-force illustration?
It projects the policy’s future charges, values, and the premium needed to keep it in force, which is the buyer’s ongoing cost. Request both a current-assumptions version and a guaranteed-maximum-charges version, because the difference between them shows how much risk the contract carries.
Which Unum company issued my policy?
Unum Group underwrites through several licensed insurers, including Unum Life Insurance Company of America, First Unum for New York business, Provident Life and Accident, and Colonial Life. The issuer is named on your contract, and forms route to that entity. Confirm with the service number on your statement.
Would a well-funded policy sell for more?
Not necessarily. A large cash surrender value raises the floor a buyer has to beat and can compress the offer, while a thinly funded policy leaves more spread. Face amount, the insured’s health, and required premium all matter more than account value by itself.
How much can I expect to receive?
Federal GAO research found sellers typically received about 10% to 35% of face value, roughly 4 to 8 times cash surrender value on average. Anyone quoting a specific figure before reviewing the policy and the insured’s health is guessing. A free review is the honest first step.
How long does the process take?
Generally 60 to 120 days from application to funded payment. The in-force illustration and medical records take the longest, followed by the ownership change with the insurer. Payment should sit in independent escrow until the transfer is confirmed, and most states then allow a rescission period.
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Related Reading
- Life Settlement Vs Surrender
- What Is A Policy Loan
- What Is A Life Settlement Broker
- What Is A Rescission Period
- Sell My Unum Group Life Policy
- Sell My Unum Whole Life 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.