What Is Viatical Life Insurance? 
The viatical concept is the buying of life insurance policies from the terminally ill . The market grew out of the AIDS epidemic in the 1980s . The policy-owner transfers ownership of the policy to an entity which pays cash for the policy . The cash is often useful to help with medical bills which can be large for end of life care . The value of the policy is likely greater than its cash surrender value but less than its death benefit . The entity makes a profit on the difference between the sale price and the death benefit they collect when the insured dies . The viatical market evolved into what is now called life settlements where the policies being sold are no longer just involving the terminally ill but also include seniors who have unwanted life insurance policies and desire to get something more than the cash surrender value for them . The financial crisis and miscalculation of life expectancy within the life settlement business caused the investor frenzy of the time to cool sharply several years ago making the transactions less popular today though still viable under idea conditions . 