Want to sell your life insurance policy?

The offer doesn’t usually happen on a dingy street corner, it’s more likely to be a phone call with a phony introduction speech. “Remember when you took that cruise a few years ago? You filled out this form and it went into a draw? Well, you won a prize and we’re calling to invite you to visit our offices and collect it.” Of course you fall for this hook, line and sinker. You rush to tell your wife. You, Jimmy are 78 and she, Annie, is 75. You are both bored and a prize out of the blue is just what you need. Perhaps you have won another cruise…

Jimmy and Annie and drive to the offices of this company on a summer evening. They are due at 7. They haven’t eaten because “there’s bound to be food there”, and they are hungry and excited. At the offices they meet other couples all about their age and there is an atmosphere of expectancy; they have all come to collect prizes. But there are speeches first. And they listen. The man is talking about senior age, fun, cruises, travel and entertainment. All sorts of things that they cannot afford because the interest rates are down, the cost of living is up, everything is much more expensive that it was in ‘their day’ and they are living very quietly so as not to overspend. We have the apartment, its mortgage free and we have the life insurance policy, they always remind each other when they are feeling really gloomy about money.

“I want to help you,” says the man with the hypnotizing smile. “I really want to help you and I’ll tell you what I am going to do to put your lives back into ones of luxury, cruises, dinners and parties. I am going to buy your life insurance policies. Hands up all those who have insurance policies!” Every hand goes up. These people harvested the names off a life insurance database. And he makes offer. “Jimmy, I will give you a check in the next five minutes for your policy. Four hundred thousand dollars!”

Jimmy turns to Annie, looks at the tears in her eyes and they nod their heads. They leave with the check in their hands and head for the nearest restaurant to start ‘living it up”. And why shouldn’t they, at their ages and with all this new-found money?

There is nothing wrong with this story or with what Jimmy did, except for one thing. Jimmy could have sold his policy back to the company for eight hundred thousand dollars.