If the person lives past his or her predicted life expectancy, you'll have progressively lower returns. You might even be asked to put up more money, to keep the policy in force. People sell their insurance policies to raise cash. Sometimes they're terminally ill and want money for treatment or personal expenses. Sometimes they don't need the policy any more, and can sell it for more than they'd get if they redeemed it for its cash value.
Viatical transactions sound grisly.
But they can be fair, if the terms are disclosed and everyone is honestly paid. Cleansheeters pretend to be healthy, although they're really terminally ill. They buy life insurance, based on a fraudulent medical statement. Then they sell the policy to investors, through a viatical broker. Both the cleansheeters and the brokers take large fees.