Can I Sell My UK Life Insurance Policy?

Yes, you can sell your life insurance policy in the UK. Learn more about the details and specifics of the process in this article.

This page is for informational purposes only. Insurance Hero doesn’t offer a facility to buy or sell life insurance policies in the UK and cannot accept enquiries about this subject.

People sell their life insurance policies for many reasons, including relief from high premiums, an urgent need for money, paying off medical bills/taxes, or a person who is terminally ill and wants to use the money to celebrate life.

The last scenario is typical for individuals who never settled down and had a family. In other words, they lack beneficiaries who would need their life insurance payout if they pass away. 

If you want to sell your UK life insurance policy, you should go into the nitty-gritty details and learn as much information as possible. While it’s a billion-dollar market in the US, it is still a niche market in the UK. 

How Does the Process of Selling Insurance Policies in the UK Go?

Traded life policies (TLPs) and traded endowment policies (TEPs) are life insurance policies sold to investors.

The process by which you can sell your life insurance policy is called a life settlement. It involves exchanging your policy for a third-party investor in exchange for a one-time cash payment that can be used for any purpose, including covering retirement living expenses, paying off debt, or going on a lifetime holiday.

Your life insurance policy must have a “death benefit” to be sold. This is the amount the insurer will pay to your beneficiaries when you die.

Death benefits vary immensely depending on age, medical records, lifestyle, and policy type.

Second-hand policies are purchased with the intent to sell them as low-risk investments. 

You will need a broker when selling your life insurance policy for cash on the secondary market. A life settlement broker acts as a medium, helping an individual find a buyer for his policy. 

When you’ve sold your life insurance, the buyer takes over responsibility for paying your insurance premiums for the rest of your life. After you die, they receive the death benefit from your policy.

Who Is Involved in Selling My UK Life Insurance Policy?

As mentioned earlier, it’s still a relatively nascent market in the UK.

There are two options available for selling your life insurance policy there:

• A life settlement provider
• A life settlement broker

In the first case, you apply directly to the company purchasing the policy. 

The leading player is a registered charity known as Life Benefit Resources. It directs funds to organisations that support and care for the terminally ill across the UK and Europe. 

The charity will purchase from life assurance policyholders diagnosed with a life expectancy of 3 years or less.

Life Benefit Resources also insists that if you have dependent minors, you must show that measures have been taken for their financial welfare before you sell the policy.

Apart from the primary market, there is also a secondary one. In this case, you can turn to a life settlement broker who, acting on your behalf, will reach several providers to get competing quotes.

The most significant advantage of private investors is that you need to do minimal legwork. Though the buyer purchases the policy at a discount, say 30% of the full benefit, he receives the full life benefit upon the assured’s death.

Mind that with a broker, you’ll need to pay a commission that might be as much as 20% of your settlement. 

How Much Do I Get If I Sell My Life Insurance Policy?

You will receive a one-time cash payment when you sell your life insurance policy. You must understand that the amount will vary significantly depending on the specifics of your case. 

Unfortunately, there is no reliable way to estimate how much your policy may be worth because there is no standard settlement ratio or payout amount. 

The amount of cash will depend on the following factors:

• your age (for example, under 30)
• your health status
• your life expectancy
• policy size and type
• expected premium payments
• premium schedule

If you were researching life settlements, you might have encountered life settlement calculators. However, it would be best not to rely on their estimates. These calculators are usually inaccurate as they are based on very limited information.

Tips for Selling Life Insurance Policy in the UK

Selling your life insurance policy is usually a daunting, painstaking process. Let alone find a reputable investor willing to give you a good offer. However, there are several ways to boost your payout.

Check out a few tips:

Familiarise Yourself with the Process

Before you begin selling your life insurance policy, it’s a good idea to have a firm grasp of how it works and what to expect. 

Make sure you are aware of the following:

• Your policy type
• the amount of cash value in your account
• the amount of coverage you have

Additionally, research the UK’s rules and regulations on selling life insurance policies.

Hire an Independent Expert

To sell your life insurance policy under the most beneficial conditions, you’ll need an expert in life insurance settlements to assess your policy’s value and help fill in the gaps.

Find a Reputable Broker

When looking for a reputable broker, you may be confused by the number of options available. Don’t be in a hurry; interview several brokers. Yes, it may take some time. However, you will have a chance to find the most suitable conditions.

Watch out for the transaction costs, as brokers tend to eat up profits. According to some experts, brokers may charge between 5% and 15% of the gross policy cost and between 30% and 50%.

Gather All Your Documents

Besides a copy of your life insurance policy, buyers will also ask for your medical records to assess the value of your policy. Some exceptionally demanding buyers will want to check your five-year medical history. Mind that obtaining these records can save you a few hundred dollars, but it may take some time.

Perks of Selling a Life Insurance Policy

End Up With Premium Payments

The biggest perk of selling your life insurance policy is that you no longer have to worry about making high premium payments. 

Get the Value of Your Policy Now 

The primary goal of life insurance is to guarantee that your beneficiaries will be able to support themselves and cover end-of-life expenses on the occasion of your death. 

However, if you don’t have beneficiaries, your family members are well off and don’t need the payout from your policy to make ends meet, you can sell your life insurance and get the value of your policy now.

Get More Cash Than the Surrender Value 

The amount of money you get from a life settlement is typically four times bigger than the accumulated cash surrender value.

Alternatives to Selling Insurance

If you urgently need quick cash and are considering selling your life insurance, check out a few better alternatives first:

Replace Your Policy with a Better Offer

The life insurance policy you own may not be the most beneficial and affordable among all the great available options on the market.

Borrow from Your Policy

Borrowing from the policy is another alternative to selling your life insurance. However, it involves some risks. 

This way, you borrow from the accumulated cash value. In the event of non-payment of the loan, the interest will increase, and the death benefit will be reduced by the amount owed.

Use Accelerated Death Benefits

Depending on your policy contract, the current option may be available if you are terminally ill. In this case, you may access your life insurance policy’s accelerated death benefits.

Get in touch with your insurance company and learn more about this option.

For 2026

Now you know the subtleties of life insurance selling in the UK. While it is possible to sell your policy, there are a few factors to consider when searching for a buyer.

The most important decision is whether to work with a life settlement provider or a life settlement broker.

If you’ve decided to go with the second option, be extremely thorough when choosing a broker to secure the most suitable conditions and avoid losing your profits.

FAQs

Can any type of life insurance policy be sold?

Almost all policy types, including term and whole life insurance, can be sold. 

Among the exceptions are group life insurance or employer-provided life insurance. You can’t sell those to another investor.

How can I find a reputable broker?

Don’t neglect to do thorough online research before deciding which broker to work with. We’ve already mentioned that consulting an independent expert would be the best idea. 

Before hiring a broker, choose a few with good reviews and arrange short interviews with each. Ask them about their process, their experience, and, most importantly, their fees.

Should I sell my life insurance policy?

It’s up to you to decide whether selling your life insurance policy is a good idea. But before doing so, consider the better alternatives to selling insurance mentioned above.