Yes, a variable universal life certificate can be sold in a life settlement when the owner and the contract qualify, and that is true at WoodmenLife just as it is anywhere else. The contract is yours. A buyer purchases it from you, the society is not a party to the decision, and its role is limited to recording the ownership change once a sale closes.
What makes VUL its own animal is where the money sits. Premiums go into separate-account subaccounts that behave like mutual funds, so the value inside the certificate moves with the markets. The surrender figure quoted to you in March is not the figure in September. Meanwhile the insurance charges keep coming out and the cost of insurance climbs with age, which is how a certificate that once looked self-sustaining starts asking for more money every year.
Pine Lake Life Solutions is not affiliated with, endorsed by, or acting on behalf of WoodmenLife. Nothing here is legal, tax, or investment advice. For a specific answer, send the certificate cover page for a free policy review or call (305) 209-7183.
In This Article
The Moving Target Inside a VUL
Every variable universal life contract has an investment side and an insurance side, and they pull against each other. On the investment side, your money sits in subaccounts holding equity, bond, or balanced portfolios. Because you carry the investment risk, variable products are registered securities and came with a prospectus that discloses every charge.
On the insurance side, the certificate deducts a cost of insurance charge that increases annually with the insured’s age, plus administrative fees, plus a mortality and expense risk charge assessed against separate-account assets, plus the fund-level management fees inside each subaccount. In a strong market those charges are invisible. In a flat or falling market they are the whole story, and the account value shrinks even though you kept paying.
What a Buyer Is Actually Buying
People assume the subaccount balance is the prize. It is not. A settlement buyer acquires the future death benefit and takes on the job of paying premiums until it is collected. So the valuation starts with the death benefit and the insured’s life expectancy, then subtracts the projected cost of carrying the certificate. The account value matters mainly as a cushion that lowers how much cash the buyer must feed in each year.
That explains why two certificates with identical balances can be worth very different amounts. The one with the older or less healthy insured, the bigger face amount, and the lower required premium wins.
The Compounding Squeeze
Cost of insurance in a VUL is charged on the net amount at risk, roughly the death benefit minus the account value. As the account value falls, the net amount at risk grows, and the charge is applied to a bigger number at an older-age rate. Each year makes the next year worse.
If your statements show the value declining year after year while premiums stay the same, this is what is happening. It is not a sign of anything wrong at the carrier. It is the arithmetic of an underfunded variable contract at an advanced age, and it is a reason to find out what the certificate is worth now rather than after another five years of payments.
Run the 0% Scenario
Because future returns are unknown, VUL in-force illustrations use hypothetical rates, and a rosy assumption can make a fragile certificate look healthy. Ask WoodmenLife for two projections: one at a modest assumed return and one at 0%.
The 0% run is the honest stress test. It shows the year the certificate fails if the markets simply go nowhere. Also request the premium needed to carry the contract to age 100 under each assumption, and a current charge summary. Our guide on reading an in-force illustration covers the columns, with one VUL-specific rule: never rely on a single projection.
| Exit Path | What You Receive | What Happens to the Coverage | Best Fit When |
|---|---|---|---|
| Keep paying premiums | Nothing now | Stays in force if funded | Someone still depends on the death benefit |
| Reduce the death benefit | Nothing now, lower bill | Smaller coverage continues | You want some protection at less cost |
| Surrender the certificate | Account value less charges and loans | Ends immediately | Small balance, no settlement interest |
| Let it lapse | Nothing | Ends with no value | Almost never the best choice |
| Life settlement | Lump sum, typically 10 to 35 percent of face value (GAO-10-775) | Transfers to the buyer, who pays future premiums | Coverage no longer needed and cash is |
Fraternal Certificates and Assignment
WoodmenLife has been a fraternal benefit society since its founding in Omaha in 1890 as Woodmen of the World, taking the WoodmenLife name in 2015. Members hold certificates, the society has no shareholders and pays no shareholder dividends, and chapter participation is part of membership.
For a settlement, the specific question is whether your certificate allows an absolute assignment to a non-member institutional owner. Fraternal contracts sometimes carry membership-linked language. Ask the society in writing, for your certificate series, and treat the answer as a gating item to resolve as of 2026 before anything else. Variable products may also be serviced by a specific administrative unit, so confirm where illustration and assignment requests should be sent.
Settlement, Surrender, or Keep
Surrendering returns the account value less any surrender charge and any outstanding loan. On an older certificate the surrender charge has usually run off, but the balance may be thin. Selling is priced on the death benefit and life expectancy instead, which is why a depleted VUL can be worth far more sold than surrendered.
Market research including the GAO’s study (GAO-10-775) points to sellers typically receiving roughly 10% to 35% of face value, and averages of several times cash surrender value. Compare the two paths honestly using settlement versus surrender, and remember your surrender figure will drift with the markets while you decide.
How the Process Runs
Expect roughly 60 to 120 days. You supply the cover page, recent statements, illustrations, and authorization for medical records. Underwriters produce a life expectancy report, offers follow, and if you accept, closing documents go to WoodmenLife for the ownership change with funds held in escrow until the society confirms the transfer.
Keep paying premiums until the money is released, and expect a rescission period after closing in most states, commonly around 15 days. Ask what applies where you live before signing anything.
Get the Real Numbers
VUL is the policy type where general advice helps least, because charges, market performance, and the insured’s health all move at once. A free policy review replaces the guesswork with two concrete figures: what surrendering pays today and what the market would pay.
Send the certificate cover page or call (305) 209-7183. If the certificate is not a candidate, you will hear that quickly and at no cost. For the screening criteria, see what policies qualify for a life settlement, and if you hold other WoodmenLife coverage, see selling a WoodmenLife whole life certificate or a WoodmenLife GUL certificate.
Frequently Asked Questions
Does market performance set the price of my certificate?
Not directly. Buyers price the death benefit and the cost of keeping the contract in force. Subaccount performance matters because a stronger account value reduces the premium a buyer must pay, but the balance is not the purchase price.
Why does my value keep dropping even though I pay every year?
Charges are outrunning returns. The cost of insurance rises annually with the insured’s age and is applied to the difference between the death benefit and the account value, so a falling balance makes that charge larger each year.
What is the mortality and expense charge?
It is an ongoing fee assessed against separate-account assets in a variable contract, disclosed in the prospectus and on your statements. It is one reason a VUL does not track a plain investment account dollar for dollar.
Does the fraternal structure affect a VUL sale?
It can. Fraternal certificates sometimes include membership-linked language affecting assignment to a non-member institutional owner. Ask WoodmenLife in writing whether your certificate permits an absolute assignment before going further.
Can I sell a certificate that already lapsed?
There is nothing left to sell once a contract has fully lapsed. If it lapsed recently, ask the society immediately whether a reinstatement window is still open, since reinstating may restore an asset with real value.
Should I move my subaccounts to something safer first?
That is an investment decision and this page is not investment advice. Speak with the financial professional who services the certificate, since allocation affects both your surrender value and the contract’s stability during the sale process.
How long does a VUL settlement take?
Usually 60 to 120 days. Medical record collection is the slowest part, followed by life expectancy underwriting, offers, and the ownership change. Funds are held in escrow until the society confirms the transfer.
What do I need to send to begin?
The certificate cover page is enough to start. Recent statements and in-force illustrations at both a modest return and 0% make the review faster and more accurate. Call (305) 209-7183 with any questions.
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Related Reading
- What Is An In Force Illustration
- Life Settlement Vs Surrender
- What Policies Qualify For Life Settlement
- Sell My Woodmenlife Whole Life Policy
- Sell My Woodmenlife 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.