Life expectancy is the primary factor considered by insurance companies.
We know that a life insurance policy allows you to financially secure you and your family’s future and well-being in case anything happens to you and you are not able to provide for your dependent family members. The life insurance policy has many benefits. Some of those benefits, for instance, can be used to help pay for final expenses after you pass away. Other benefits, such as accelerated death benefits (ADB), allow someone with a life insurance policy who is terminally ill to access a portion of the policy’s death benefit while they are alive.
“As The Accelerated Death Benefit (ADB) is a provision in most life insurance policies that allows a person to receive a portion of their life insurance money early — to use while they are still living. ADB is a standard in the industry and offered by most life insurance carriers,” said Juan Carlos “JC” Doitteau, President at Insurance Pro.
What Qualifies For Accelerated Death Benefit?
You qualify for accelerated death benefits if . You also , if you need an organ transplant because of illness, or if:
- you contract a terminal illness and are expected to die within two years
- you qualify if you’ve been diagnosed with an illness that will reduce your expected lifespan
- you need an organ transplant because of illness
- you are in hospice long-term care
How Are Accelerated Death Benefits Paid?
An Accelerated Death Benefit (ADB) allows a life insurance policy owner to receive a portion of their death benefit from their insurance company in advance of their death. In most cases, the policyholder must be terminally ill, usually with a life expectancy of two years or less.
Pros & Cons of Accelerated Death Benefits
Accelerated Death Benefits can be used for any purpose the senior chooses, including home care, nursing home care, assisted living, and hospice. ADB beneficiaries still receive a death benefit, although it is reduced by the amount of the accelerated death benefit.
There are no major drawbacks to the Accelerated Death Benefits. Its biggest limitation is that policyholders are required to be terminally ill, or in some cases, chronically ill.
Read also: Top Life Insurance Myths.
Learn about this and other fringe benefits by contacting Insurance Pro experts.