The sale, assignment, transfer, or bequest of the death benefit or the ownership of a life insurance policy by the owner of the policy to a viatical settlement company when the insured has a catastrophic or life-threatening illness or condition. Usually, the policy owner receives cash from the viatical settlement company, which becomes the new owner and beneficiary of the policy and becomes responsible for paying future premiums. Viatical settlement companies collect the face value of a policy upon the policyholder’s death.