I am a widowed, retired federal employee, and not in very good health. I have for years had a life policy for about $286,000 through the Office of Personnel Management (OPM) carried by MetLife. I only have one beneficiary which is my only child (25 years of age). There is no cash value before my death. This not a term policy.

Question: Is there a way to assign a portion of this policy for cash? If so, what could I expect to be offered for an assignment of $50,000? Just an example to get an idea how this might work.

  1. 11498 POINTS
    Jason Goldenzweig
    Co-Founder, TermInsuranceBrokers.com, Goldenzweig Financial Group, Las Vegas, Nevada
    Life insurance proceeds cannot be paid to cash. A designated beneficiary must be assigned to receive the proceeds. In the instances where a beneficiary predeceases the insured and there are no contingent beneficiaries assigned/remaining, then the proceeds would be paid to the insured's estate (assuming a trust is not involved - which i imagine is the case if your policy is provided via a federal employee program) - the proceeds must then go through the probate process and distribution would be handled by the courts.

    A beneficiary of a life insurance policy must have an insurable interest to the insured person - this includes persons, businesses, and other types of organizations.

    What is the reason for wanting to assign $50,000 of the $286,000 coverage amount to cash and not to your son or another person/entity?
    Answered on January 11, 2016
  2. 3998 POINTS
    Matt Benore
    Founder, DenverWest Insurance Professionals, Inc.,
    Good Day to you.
    There is no way to assign a portion of your benefit based on what you have provided however you might qualify for a life settlement. Life Settlements is basically selling your policy to get some cash. What happens if you qualify, is the owner and beneficiary would change. Upon death, the benefit would go to the new beneficiary/owner.

    I hope this helps. If you want more information, please reach out to me.

    Answered on January 12, 2016
  3. 11783 POINTS
    Larry GilmorePRO
    Agent Owner, Gilmore Insurance Services, Marysville, Washington State
    Can I assign a portion of my death benefit to cash? Generally no. A life insurance policy has a stated beneficiary or goes to your estate. It is hard to figure what you want cash for? is it to pay something off? to gift? You can directly state such things in your beneficiary declaration. Basically the proceeds need to be assigned to someone or some thing (charity) or the proceeds are included in probate and distributed that way.
    Answered on February 6, 2016
  4. 1976 POINTS
    Ronald Hinch
    Regional Marketing Director, Capital Choice Financial Group,
    No, life insurance proceeds cannot be assigned for cash. In the event that death of a policy holder occurs the named beneficiary will receive the death proceeds unless their is an colateral assignment to someone else or some other entity such as a bank or financial institution. This happens when possibly when a loan must be paid back for business.
    Answered on June 1, 2016
  5. 63333 POINTS
    Peggy Mace
    Most of the U.S.
    Due to your poor health, you may be able to sell your policy as a life settlement. This would eliminate your daughter as the beneficiary, however. To my knowledge, investors that would buy your policy would want to purchase the whole thing, and not a $50,000 chunk.
    Answered on November 10, 2016
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