About Coventry Direct

Whether your life insurance premiums are too expensive to maintain, you have more life insurance coverage than you currently need, you need help with increasing medical or long-term care expenses, or you’d like to boost your retirement funds, Coventry Direct can help you sell all or part of your life insurance policy for cash.

According to Coventry Direct, this process—known as a life settlement—can help you realize “significantly” more value than if your life insurance policy lapsed or was surrendered. In fact, Coventry claims that a life settlement could help you receive 4X more than the surrender amount!

All you have to do is complete an online form to see if you qualify, and Coventry Direct promises to “help you discover your life insurance policy’s hidden value.”

If you’re thinking about selling some or all of your life insurance policy, you have a lot of questions. After all, you’re probably talking about a significant chunk of change here. What are the details behind a life settlement? Is it a good idea? What are the pros and cons? When it comes down to it, is Coventry Direct your best option?

Let’s start answering your questions by taking a look at life settlement basics.

What Is a Life Settlement? How Does It Work?

According to the Life Insurance Settlement Association (LISA):

“A life settlement is the sale of a life insurance policy to a third party for a value in excess of the policy’s cash surrender value, but less than its face value, or death benefit. A policy owner receives a cash payment, while the purchaser of the policy assumes all future premium payments and receives the death benefit upon the death of the insured.”

From a legal perspective, this is possible because a life insurance policy is considered property, similar to stocks and bonds. As such, they can (among other things) be borrowed against for a loan and sold to another individual.

Here’s a simplified look at how it works: A portion of every payment you make on a life insurance policy goes toward increasing its cash value. So, all things being equal, someone who’s paid on their policy for 20 years will almost certainly have more cash value at stake than some who’s been making payments for 5.

Depending on the type of policy you have though (e.g. whole, universal, variable, etc.), your policy can also gain cash value in other ways. These include formulas determined by the carrier, current interest rates, subaccounts like stocks and bonds, and more.

Now, let’s say that you’re 70, in poor health, and can’t afford your monthly payments any longer. You’ve been paying on your policy for decades and it now has a total cash value of $250K. However, if you were to surrender your policy to the carrier, it might only be worth a fraction of that amount; say, $30K.

Enter a company like Coventry Direct, who could arrange to purchase your policy for $180K. Sure, it’s much less than the actual value of the policy, but much more than what you’d get if you were to surrender the coverage. Then, when you passed away, the company would cash in your policy and receive the full $250K, netting them a $70K profit.

But hold on: Is Coventry Direct the company that will purchase your life insurance policy, or is it someone else?

Does Coventry Direct Purchase Life Settlements?

According to a disclaimer at the bottom of their website:

“Coventry Direct is a marketing company. It is not a life settlement provider or broker. Coventry Direct will refer qualified policies to a licensed entity.”

In other words, the answer is no. Instead, Coventry Direct acts as a kind of referral service, essentially advertising policies to potential investors, who often try to outbid one another. However, it appears the company will qualify your policy prior to submitting it to investors, which can be determined by “your age, type of insurance policy, the premiums and your health.”

You’ll also need to be 65+ (or have had a change in health) with a life insurance policy face value equal to or greater than $100K.

Regardless whether you go through Coventry Direct or another company, is a life settlement a good idea in the first place?

Life Settlement Pros & Cons

As we briefly discussed above, perhaps the biggest benefit of selling a life insurance policy is that you can free up cash to use for medical expenses, retirement funds, or just about anything else. And life settlements can be even more beneficial depending on your reason for selling (i.e. can no longer afford the premium, etc.).

On the other hand, if possible, most professionals recommend keeping life insurance policies in force until the policyholder has passed. Why? Because the payout to spouses and heirs will be much greater than anything offered through a life settlement.

On top of this lower amount, any income earned through a life settlement may be taxed as income, depending on how much premium you’ve paid (generally, money paid as part of a life insurance policy is non-taxable). Also, depending on your state, the life settlement industry may be largely unregulated, and some agents don’t have to be licensed or registered with the state in order to run their business. In short, there could be very little oversight of the industry in your state.

Finally, keep in mind that the life settlements industry is relatively new, and competition between companies can be intense. As such, you may experience some hard selling techniques after reaching out for a quote.

To help protect yourself and ensure you’re making the right decision, the Financial Industry Regulatory Authority (FINRA) recommends uncovering answers to the following questions:

  • Is the life settlement provider licensed in my state?
  • What will happen to my policy? Will it be held, sold to another company, or packaged with other policies and sold to investors?
  • What information is required? Who needs it, and what will they do with it?
  • What’s the best way to protect my privacy?
  • Am I getting the best price for my policy?
  • What are the transaction costs/fees? Are there any tax consequences?
  • Am I able to change my mind? If so, will there be any penalties?
  • Is this in my best interest? Am I being pressured into making a decision?

Considering everything we’ve talked about so far, what are Coventry Direct’s customers saying about their experiences?

Coventry Direct Customer Reviews

Considering the length of time the company’s been in business, along with the fact that they’re the largest life settlement company in the industry (more than $3 billion purchased to date), there was surprisingly little online customer feedback for Coventry Direct at the time of our research. Obviously, the company’s busy buying policies, but it doesn’t seem like customers are talking about their experiences online once the process is complete.

In fact, the vast majority of the online reviews we encountered were for Coventry Direct’s parent company (Coventry Health Care, Inc.), which is primarily a health insurance provider. This was especially the case on Coventry’s Better Business Bureau page, where they had an A+ rating, despite 400+ closed complaints (as of 5/2/16).

We also found a 2014 Business Insider article covering AIG’s litigation against Coventry Direct, claiming they “used a network of shell companies to artificially inflate the prices to [some of their investors].” The case appears to have been settled earlier this year.

Is Coventry Direct Your Best Option for Life Settlements?

If you search online for life settlement companies, you’ll find that Coventry Direct is certainly the largest. However, they’re definitely not your only option. To find a member company in your state that’s authorized by the Life Insurance Settlement Association, be sure to check out the organization’s Search page.

Also, considering the amount of money potentially on the line, you’ll also want to speak with your financial planner or advisor, who can provide professional advice about whether or not a life settlement is in your best interests.

Did you sell your life insurance policy to Coventry Direct? How did the process go? Do you feel like you got a fair deal? Tell us all about it by writing a review below!

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11 Customer Reviews for Coventry Direct

Average Customer Rating: 4.2
Rating Snapshot:
5 star: 8 4 star: 1 3 star: 0 2 star: 0 1 star:  2
Bottom Line: 82% would recommend it to a friend
Showing 1-11 of 11
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  • Coventry got the job done!

    • Phoenix, Arizona,
    • Aug 15, 2017
    • Verified Reviewer

    I wanted to share my experience with Coventry.com.

    Feeling a bit skeptical after seeing a late night commercial, I looked into it to see what it was about and if it was legit. While I found the company to be a bit unorganized and slow to process and approve my life settlement, my advisor Billy Gu did a really good job. He constantly kept in touch to let me know where it was in the process and contacted me immediately when I got approved.

    Billy even went the extra mile and did a three-way phone call with me to my insurance company when I could not find the original paperwork. This helped alleviate the stress and hassle on my end.

    All in all, because of Billy's expertise it was a good experience. I do advise anybody who's going through this process to read the contract carefully, and then make an educated decision if this is best for you.

    Thank you again Billy Gu!

    Bottom Line: Yes, I would recommend this to a friend

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  • Wonderful, helpful people

    Our experience with Coventry was excellent from the first phone call until our money appeared in our bank account. KELLY ROONEY was our contact person, and she took care of us as if we were family. She knew our situation and the anxiety we felt over my husband's cancer and an impending move. She called and kept us in the loop as to what was happening, the timeline, and just what to expect. She got things done even though our case was a difficult one dealing with the life insurance company we had. I will certainly tell others where to go when there seems to be no hope. Thank you all at Coventry Direct.

    Bottom Line: Yes, I would recommend this to a friend

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  • 1 out 1 people found this review helpful

    Satisfied

    Having a Term Life Insurance Policy that was due to expire in several years with no cash value my wife and I decided to review our options. We were aware of Coventry as a result of their TV commercials.

    The entire process from start to finish was about six months, at the end of which I received the negotiated price for my policy. Working with Coventry's representative (Tyson Mayer) was always a professional and enjoyable experience. Tyson kept us up to date every step of the way. The many documents requiring signatures were reviewed by two attorneys and discussed with a former insurance/financial planner. All documents and forms were approved with one minor change.

    My wife and I would strongly recommend working with Tyson Mayer to confirm your options.

    Bottom Line: Yes, I would recommend this to a friend

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  • 1 out 1 people found this review helpful

    Good experience

    • Vermont,
    • Aug 1, 2017
    • Verified Reviewer

    Unlike the other reviewers here, I had a very positive experience with Coventry. Life settlements are complicated and time-consuming transactions. Every situation is different and presents its own challenges. I dealt with two individuals at Coventry over the course of several months and found them both to be extremely knowledgeable and professional.

    The process inevitably takes longer than expected because medical professionals are slow to turn over records and the insurance company whose policy is being sold delays as well. In the end, Coventry delivered for us, beating the prices offered by competitors.

    Bottom Line: Yes, I would recommend this to a friend

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  • 2 out 2 people found this review helpful

    A blessing for many

    • Philadelphia, PA,
    • Aug 1, 2017
    • Verified Reviewer

    I cannot recommend Coventry Direct highly enough. At a point during my husband's terminal illness, we decided to investigate the option of selling one of his insurance policies to help with our current finances. Being a life insurance agent, my husband investigated various companies who perform this service, and we ended up making a deal with Tyson Mayer at Coventry.

    Being that we are local to the headquarters, we chose to meet Tyson and his associates personally. They were very kind, professional and worked hard to give us the best offer possible and, in fact, they made it a point to do so. Once our decision was made, the process was very quick. We signed papers and got our payment within days. Having this money was very comforting to us during a very challenging and emotional time, and working with Tyson and Coventry made a very emotional and regretful situation as best as it could possibly be.

    Bottom Line: Yes, I would recommend this to a friend

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  • 2 out 2 people found this review helpful

    My take on Coventry Direct

    • Farmington, Michigan,
    • Jul 29, 2017
    • Verified Reviewer

    For me, dealing with Coventry Direct was a great experience. I was treated with respect and felt their representatives (especially Peter Herschon) truly cared about my circumstances. It was a multiple-month period with a unique parameter of being younger than their typical client. Nevertheless, they worked with me all the way and helped me receive a generous compensation for my unneeded life insurance. I would recommend Coventry Direct to anybody, especially Mr. Herschon.

    Bottom Line: Yes, I would recommend this to a friend

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  • 2 out 2 people found this review helpful

    Kelly Rooney is the best!

    Kelley Rooney took ownership of my application on day one and continued to work with me throughout the process and up to and including the fund's transfer.

    If you decide to apply to Coventry Direct, be sure to ask for Kelley. By the time the process was completed, I felt like I had know Kelley for years!

    Bottom Line: Yes, I would recommend this to a friend

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  • 3 out 3 people found this review helpful

    Great service. Constant communication. Thanks Kelley!

    • Laredo, Texas,
    • Jul 28, 2017
    • Verified Reviewer

    When my father was looking for a company to purchase his existing life insurance policy, we decided to contact Coventry Direct. I'm so glad we did! Kelley Rooney, our representative, was AWESOME. From beginning to end, she had constant communication with me, and the utmost professionalism in handling our file. She is great at her craft and very sensitive to the client's needs. She helped my dad get a fair settlement. Thanks Kelley, you're the best! 10/10 stars!

    Bottom Line: Yes, I would recommend this to a friend

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  • 2 out 2 people found this review helpful

    Great service

    • North Carolina,
    • Jul 28, 2017
    • Verified Reviewer

    I had a great experience with Coventry Direct. The process was very efficient. My representative was very knowledgeable and professional. We received a quick payout that significantly helped my family.

    Bottom Line: Yes, I would recommend this to a friend

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  • 2 out 3 people found this review helpful

    Lies and B.S. and foot-dragging!

    Well, I wish I would have seen this when I "trusted" Billy to get me something for my $350,000 life insurance policy. Problem is that until he and his company were nearly two months into the review, no one had the idea to check with my company and talk about "converting" the policy! Well, the idiots, "Billy" found out that we were a month late in asking that question! So we could have converted the policy with "no medical questions" to a frozen premium of about $764 for the next 35 years, which would have made the product of interest to a buyer! So because "Billy" was (is) clueless, all I got from was "sorry!"

    "Sorry" won't pay the bills! Do not trust this company; I am sorry I did!

    Bottom Line: No, I would not recommend this to a friend

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  • 15 out 18 people found this review helpful

    Denial

    • Lumberton, MS,
    • May 1, 2017
    • Verified Reviewer

    They say if you no longer can afford your policy, that they would buy it. Fraud advertising. paper workI have a 100,000 policy, and they received all my paperwork. Then I was denied since I Wasn't about to drop dead or meet their requirements. They have all my medical papers and I have requested them back. I have yet to receive them. This is a company seeking your information, false advertisement.

    Bottom Line: No, I would not recommend this to a friend

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