Life Insurance Question

[zeto]

I have stage 3 colon cancer. I have a 700K life insurance policy with a rider for accelerated benefits. Any idea how much of it I could collect as an accelerated benefit, as this invasive cancer is considered to be a "critical illness?" I'm 45 and live in IL.

[behconsult]

My understanding is you must be terminal and stage three is not considered terminal. Your unique requirements should be stipulated in the dirty details of your policy. From a psychological standpoint be careful with your mindset with respect to health and potential money benefits, if that thought does cross your mind.

[DBF]

I did a Viatical settlement with my 20-year term policy. I initially got the policy in my early 30s. I took a chance that I would outlive the term and accepted 60% of the payout. It was sold to a fund- now they are the beneficiary. I don't think I would've done it if I didn't have other life insurance, though. You can do a settlement, but the sicker you are, the higher a percentage you're gonna get. For a viatical settlement, your doctor can provide a letter stating that it is "reasonable" that you will die within 24 months. If you have that letter (called a "24 month letter") the money is tax free. Remember- there will be people gambling on the fact that you will die, as crazy as that sounds, so the more likely that is to happen, the bigger the payout you'll get. I'm happy to discuss it with you. Feel free to PM me.

[JDinNC]

You raised my interest about a accelerate death benefit rider. I have a term policy where I didn't have this provision added to it. Though I did have a brochure which explained this benefit. If I read it correctly...you can receive this benefit once a doctor states you are terminal with less then a year to live but if you live past the 12 months. They will begin to charge for the coverage which remains in effect...so be careful because your premuin might be higher then it was previously. At least this is how it's read in my policy

Jan

[DBF]

I have a term policy where I didn't have this provision added to it. Though I did have a brochure which explained this benefit. If I read it correctly...you can receive this benefit once a doctor states you are terminal with less then a year to live but if you live past the 12 months. They will begin to charge for the coverage which remains in effect...so be careful because your premuin might be higher then it was previously. At least this is how it's read in my policy
Jan

What percentage would you get from an accelerated benefit? Is it the entire amount? I'm curious. My term policy didn't have this benefit so I sold to a third party.

[JDinNC]

From their generic example of the effect that an accelerated death benefit payment of 50% of the death benefit would have on the policy.

Death benefit on a $100,000.00. policy....after acceleration $50,000.00
Annual premium $1,000............................................. 0*
Outstanding policy loan $5,000. .........................................$2,500.
Gross cash value. $18,000....................................... $9,000.

1. Claim charge...$150.
2. Pro rate amount of outstanding loan...$2,500.
3. Interest amount on accelerated.........$3,704.

( $50,000.- $150.-$2,500.-$3,704.)=$43,646.

If after 12 months the person is still alive, the annual premium will be $500.

This was their example....I don't have a accelerated rider on my term policy so I don't know how it actually works.

Hope this helped...

[Robinf]

Every single life insurance plan will be different, both in the amount of the payoff and when you can collect it. I am in the process of doing this myself and I can collect 75% of my plan amount up to 500k based on doctor certifying I'm terminal and my life expectancy is less than 24 months.

Again, though each plan is different so you'll only know once you talk to your insurer.

Good luck!

[larway]

Different companies will have different provisions for accelerated benefits. On my policy with AIG, I don't have to be terminal just have a one of their specified critical illness diagnosis of which one is invasive cancer.

Check with your agent.

[zeto]

My understanding is you must be terminal and stage three is not considered terminal. Your unique requirements should be stipulated in the dirty details of your policy. From a psychological standpoint be careful with your mindset with respect to health and potential money benefits, if that thought does cross your mind.

I think you misunderstand. I'm not seeking to get rich and I'm not seeking to be terminal just to get money. However, I specifically signed a form for a rider for a "critical illness," which stage 3 colon cancer is for my current policy. I'm only seeking to utilize a provision that I had the wherewithal to obtain and by legal right have a right to obtain. There is a difference between a critical illness and a terminal illness and both are delineated in my policy riders. I have riders for both as well as for chronic illness, which is the third category.

[behconsult]

Makes perfect sense. Best wishes to you and smart move on your part. Bob