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Accelerated benefits

Short Description

A life insurance policy rider that allows the insured to receive the proceeds of a life insurance policy before death under certain conditions, such as terminal or catastrophic illness, the need for long-term care, or confinement in a nursing home.

Long Description

Death benefits are typically paid to an insured’s beneficiaries upon death. The accelerated death benefit is a life insurance policy option that provides funds to an insured individual while that person is still alive, but during what is medically believed to be the insured’s final year or two of life. The purpose of the option, which first appeared in the 1980s, is to provide money to the insured to cover medical and medically related expenses. Prior to death, up to 80% of the value of the death benefit can be withdrawn and used for any purpose by the policyholder. In addition to medical expenses, the funds can be used for a vacation, home improvements, hiring medical home-care personnel, or experimental care. Although a specific life insurance policy may not explicitly mention an accelerated death benefit, many companies pay it as a matter of practise. The benefit payments made to the policyholder while the insured is alive are deducted from the death benefits, and the beneficiaries receive only the balance that is left when the insured dies. The accelerated death benefit is handled differently by each insurance company. While some people deduct the amount directly from the death benefit, others consider the payments to be loans and charge interest on them. As a result, upon the death of the insured, the loan and any accrued interest will be deducted from the amount paid to the beneficiaries.

 

Also known as Living Benefits and Accelerated Death Benefit

Acceleration life insurance

A policy that enables the insured to receive 25% of the death benefit prior to death. this is done in the case of certain medical conditions, The benefit is used to cover medical expenses that will allow the insured to live longer. Any remaining benefit is paid out to the beneficiary in the traditional manner upon death.

Acceptability

The overall assessment of medical care available to an individual or group. In determining the acceptability of health services provided, the individual considers factors such as cost, quality, results, and convenience of medical care, as well as provider attitudes.

See Also: Accessibility and Availability.

Acceptance

  1. The insured’s decision to enter into an insurance contract at the insurance company’s terms.
  2. An insurer’s acceptance of a proposal for insurance, which normally concludes the contract even if the policy is not issued until later (see also Notification).
  3. The act of agreeing to an offer to form a contract. It happens when an underwriter initials a slip, or when the proposer of a life insurance policy pays the premium after receiving an offer, i.e. the acceptance letter.

Accepting assignment

1. A Medicare Part B agreement in which a Medicare participating physician agrees to accept 80% of the approved charge from the fiscal intermediary and 20% from the patient after the patient’s deductible has been met.

2. Transfer of the legal interest in an insurance policy to another person, typically when property is sold; or in life insurance, only valid with the insurance company’s consent.

3. Transfer of an individual’s right to receive payment under an insurance contract.