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You might be able to sell your life insurance policy for quick cash, but it's a little creepy to think that someone you don't know will profit from your demise.

Many seniors are now selling their life insurance policies to raise cash. In 2006 alone, life insurance policies worth $6.1 billion in death benefits changed hands. This trade wouldn't be possible, however, except for one controversial aspect: The party on the other end profits from your death, and the sooner, the better.

When you sell the life insurance policy, the buyer becomes the owner and beneficiary. Upon your death, this stranger stops paying premiums and collects the death benefit.
These transactions used to be called viatical settlements. Their debut was especially ghoulish because early investors generally were small companies that offered big discounts from the death benefit to buy policies from AIDS patients, who weren't expected to last long and desperately needed cash for medical bills.

Now these deals are called life settlements and are moving to the financial mainstream. The major institutions as well as hedge funds and even pension funds invest in packages of life settlements because the rate of return is not related to the stock market, making life settlements a portfolio diversifier. Even some life insurance companies are becoming investors.