If it is a policy with a living benefit and the person is in poor health, he may want to take the buyout. If it is a death benefit policy, he will want to keep it. For others the question is whether they can take the buyout and reinvest the money more wisely elsewhere.
"They also have to consider the solvency of the insurance company," says Milevsky. "This may be a company they were comfortable doing business with five years ago, but is it one they want to do business with now or are they waiting for the other shoe to drop?
"This is not a unique situation. People who are due pensions from large automobile companies who are being offered buyouts have the same questions facing them," he says.
-Karen DeMasters