Accelerated benefit riders offer several protection types to policyholders in a single-vehicle. Specific policies also include protection from nursing homes, chronic illnesses, and critical conditions.
Riders Permit Owner's Control
Riders that have accelerated benefits have offered owners control of their insurance plans. According to the CEO of Kestler Financial Group, Jason Kestler, “clients are now able to start or stop a stream of income from their policies when they have a qualifying need, and many riders also provide a cost-of-living adjustment to keep up with inflation.”
Consumers are currently purchasing insurance plans for a single-vehicle because of market demographics, quality financial education, and the spike of healthcare expenses and needs.
What Are Accelerated Benefit Riders?
Accelerated benefit riders have similar factors of the old viatical settlements that were used by policyholders with terminal illnesses, which were used to raise funds to pay for their medical expenses. Policyholders would then allow third-party agreements to purchase their policies for a certain percentage. The beneficiary of the policyholder would then be the settlement company. The company collects the death benefit after the demise of the policyholder.
Payment of Benefits
Some cases allow policyholders the choice of how they are paid the benefits. They may either have an installment of periodic payments or receive a sum by cash. This may depend on the type of interest and claim, but any death benefit and cash value that remains is still entitled to them. Similar to the other insurance forms, accelerated benefits are payable via an indemnity basis or reimbursements.
Additional vs. No-Cost Riders
Although some riders are directly built into the policy, others are also redeemable by paying a little extra. There are “no-cost” riders that you can spend during claiming time, where the dollar beneficial amounts paid to policy owners are discounted by the insurance carrier. They are following formulas following mortality and interest rates, along with the cash value amount in the policy.
Critical Illness Riders
Critical illness riders have a higher expense of death benefit once diagnosed with severe illnesses. Some conditions that trigger a significant payout are:
At Berlin & Denys Insurance, we do our best in making sure that our clients are well-protected with affordable and comprehensive policies. We make sure to go the extra mile to help you with your needs. To learn more about how we can help you, please contact our agency at (800) 946-3303 or Click Here to request a free quote.