Definition - What does Viatical Settlement mean?
Insuranceopedia explains Viatical Settlement
These transactions can be a little risky. Investors are making a large upfront payment for the policy and need to be able to predict the seller's life expectancy. If the seller lives longer than expected, it will lower the investor's return. That's why many viatical settlement companies only make deals with people who have been diagnosed with terminal illnesses. On the other hand, if the seller dies earlier than expected, the investor will earn a higher return.