More people in the US are now considering the option of selling their life insurance policies in order to survive the financial meltdown, it has been revealed.

An increasing number of those adopting this survival strategy, according to a report, are elderly persons who are convinced they may not live long enough to recover their losses.

Rather than allowing the policy to lapse or take the cash value, a policyholder choosing a life settlement gets more cash than the policy’s surrender value.

The settlement, however, depends on a number of variables, including medical record and life expectancy.

According to an expert, the payout is higher once the policyholder’s life expectancy is shorter.

In contrast younger policyholders, deemed to have a longer life expectancy, do not get as much as older people with shorter life expectancy from their life settlement.

“The company or investors take over payment of premiums and collect the full benefits when the insured dies. If you are healthy and relatively young, the payout may not be worth the trade off,” explained an expert.