What Is a Life Settlement?
A life settlement is the legal sale of an existing life insurance policy to a licensed third-party buyer for a lump-sum cash payment. The amount you receive is typically more than the policy's cash surrender value, but less than its face value. Once the sale is complete, the buyer assumes ownership of the policy, takes over premium payments, and receives the death benefit when the insured passes away.
Life settlements are a federally recognized financial transaction and are regulated at the state level. In Hawaii, the Hawaii Insurance Division oversees and enforces the applicable rules. This secondary market gives policyholders a legitimate alternative to simply lapsing or surrendering a policy — often recovering significantly more value in the process.
To learn more about how this process works in general, visit our How It Works page.
Is Selling a Life Insurance Policy Legal in Hawaii?
Regulated by: Hawaii Insurance Division
Life settlements are legal and regulated in Hawaii
Hawaii's Insurance Division regulates life settlements under state law, requiring providers and brokers to be licensed and to comply with consumer disclosure standards. Hawaii's regulatory approach is designed to ensure that policyholders have access to fair and transparent transactions in the secondary insurance market.
Hawaii's geographic isolation can make accessing specialized financial services more challenging for some residents, but licensed life settlement brokers and online platforms can serve Hawaii policyholders without requiring in-person meetings.
Licensing Requirements in Hawaii
Life settlement providers and brokers must hold valid licenses from the Hawaii Insurance Division. Licensing standards include qualification and compliance requirements, and licensees must remain in good standing with the Division.
When working with LifeSettlementEstimate.com, you can be confident that we connect you only with licensed and vetted buyers and brokers who meet Hawaii's regulatory requirements. Verifying licensure is a critical first step before entering into any life settlement transaction — and one we handle on your behalf.
Waiting Period Rules in Hawaii
Hawaii requires a two-year waiting period from the date a life insurance policy is issued before a life settlement transaction can be completed. Exceptions may apply for terminal or chronic illness and other qualifying circumstances.
Consumer Protections for Hawaii Residents
Hawaii requires providers to give sellers written disclosures explaining the transaction and their rights. A rescission period following contract execution allows sellers to cancel without penalty, protecting Hawaii policyholders throughout the process.
What Your Policy Might Be Worth in Hawaii
Life settlement offers vary widely based on individual circumstances. As a general industry benchmark, policyholders typically receive offers ranging from 10% to 30% of the policy's face value — and in some cases more, depending on the insured's age, health status, policy type, and premium obligations.
For example, a $500,000 policy in Hawaii could potentially generate a life settlement offer between $50,000 and $150,000 — compared to far less (or nothing) if the policy were simply lapsed or surrendered. These are industry-typical ranges and not guarantees. Your actual offer will depend entirely on your specific circumstances.
Important Disclosure
The ranges provided are general industry estimates and educational in nature. No specific payout is guaranteed. Actual offers depend on your policy details, health information, and buyer demand at the time of transaction. LifeSettlementEstimate.com does not guarantee any specific offer amount.
The best way to get an accurate picture of your policy's potential value is to start with a free, no-obligation estimate.
Tax Considerations in Hawaii
Hawaii has one of the highest state income tax rates in the country. Life settlement proceeds above the policy's cost basis may be subject to significant state income taxation in addition to federal taxes. Consulting a qualified tax advisor is strongly recommended.
Tax Disclaimer
The above is general educational information and does not constitute tax advice. Tax laws are complex and subject to change. Please consult a licensed CPA or tax attorney before completing any life settlement transaction to understand the full tax implications of your specific situation.
How the Life Settlement Process Works
Get a Free Estimate
Use LifeSettlementEstimate.com to receive a preliminary valuation of your policy. There's no personal information required beyond the basics, and no obligation to proceed.
Submit Policy Details
If you decide to move forward, you'll submit your policy information and complete a brief medical authorization. Our team gathers records and prepares your file for buyers.
Receive Competitive Offers
Your policy is presented to our network of 50+ licensed buyers in Hawaii and across the country. Multiple offers are collected and presented to you for comparison.
Accept or Decline
You are never obligated to accept any offer. If you accept, the closing paperwork is handled, and funds are typically received within 30–60 days of final approval.
See our full How It Works guide for a complete walkthrough of the life settlement process.
Why Use LifeSettlementEstimate.com in Hawaii?
LifeSettlementEstimate.com was built around one core principle: policyholders deserve transparent, unbiased information before making a major financial decision. We are an educational-first platform, not a high-pressure sales operation.
For residents of Hawaii in cities like Honolulu, Hilo, and beyond, our platform offers a compliance-first approach — connecting sellers with licensed, vetted buyers who operate within Hawaii's regulatory framework.
Free Estimate
No cost to get your initial policy valuation
No Obligation
You decide if and when to proceed
50+ Vetted Buyers
Competitive offers from licensed HI buyers
Compliance-First
HIPAA-compliant, fully transparent process
A Hawaii Resident's Story
Sandra Kalani, 68
Honolulu, Hawaii
"Sandra, a retired nurse from Honolulu, had a $250,000 whole life insurance policy she had purchased in her 40s. As Hawaii's cost of living continued to rise, she began looking for ways to increase her liquidity in retirement. A financial planner mentioned that her policy might be worth exploring through a life settlement, and Sandra visited LifeSettlementEstimate.com to get a starting estimate."
This is a fictional illustrative scenario. It does not represent an actual client or guaranteed outcome.
Frequently Asked Questions — Hawaii
Get a Free Life Settlement Estimate in Hawaii
Ready to find out what your policy may be worth? Our free estimate takes just minutes — with no obligation, no pressure, and no cost. Join Honolulu and Kailua residents who have already used LifeSettlementEstimate.com to make informed decisions about their life insurance.
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