For seniors with life insurance policies, there are a few different ways they might utilize their plans to pay for in-home care in Potomac, MD. You can take out a loan against the policy’s cash value, or you may surrender the policy in its entirety in return for the cash value.
Using the Accelerated Death Benefit
An “accelerated death benefit” rider is a cash advance deducted from the benefit amount the beneficiary receives upon the policyholder’s passing, which may be included in some policies. The policyholder must have a terminal illness with a short life expectancy, often less than 24 months, or be unable to undertake routine daily tasks to use this option to pay for in-home care in Potomac, MD.
Because the policy is not surrendered at the time of the cash advance, the policyholder must keep paying premiums to ensure the beneficiary receives the remaining portion of the initial death benefit. Before paying out any early benefits, the insurance company will need doctors’ declarations and medical records confirming the illness or loss of function.
Life Insurance Conversion
Life insurance conversion or life care funding is a more recent choice to pay for services from places such as Business name. The original owner of a life insurance policy receives elder care services in the form of a “long-term care” or “life care” benefit account rather than a flat payment from the sale of the policy. Direct payment for the provision of services such as home care must be made from this account.
Once more, the person who purchases the life insurance policy assumes the premium payments and then receives the benefit upon the passing of the original policyholder. If done correctly, life care funding, unlike settlements, will not impair a senior’s Medicaid eligibility.
