The 3 Different Types of Living Benefit Categories

three

Living benefits are categorized into 3 different categories of illness that allow you to be eligible for a payout.

There are three basic types of living benefit categories. Each category requires that you meet the qualifying criteria in order to be eligible to receive the living benefit payout.

  1. Critical Illness – to receive the living benefit payout for a critical illness, you must be diagnosed with a major medical health condition like cancer, stroke, or heart attack. Certain other qualifying health conditions may include blindness caused by diabetes, Lou Gehrig’s disease (ALS) or kidney failure.
  2. Chronic Illness – to receive the living benefit payout for chronic illness, you must be unable to independently perform two daily living activities. This may include dressing, bathing, toileting, eating and transferring. It may also be required that the policy to be in force for a certain number of years before the carrier will pay out. It’s best to check the policy’s waiting period so there aren’t any surprises.
  3. Terminal Illness – to receive the living benefit payout for terminal illness, you must be diagnosed with a terminal illness and have a life expectancy of 24 months or less. Check your policy as some states may require 12 months or less.

Once you receive the funds, you may spend them any way you wish.

All in all, living benefits should never be considered as a viable alternative to long-term care insurance, but it can offer a source of cash, should you be diagnosed with a qualifying medical condition. Ideally, it could stop your life savings from being depleted or protect other important financial resources.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s