Question

Under which of the following circumstances would an insurer pay accelerated benefits?

A A couple wants to build a house and would like to make a larger down payment.
B An insured is diagnosed with cancer and needs help paying for her medical treatment.
C A couple is nearing retirement and needs a steady stream of income.
D An insured is looking for a way to put her daughter through college.

Answer 1

Accelerated benefits may be paid by an insurer in situations such as terminal illness, permanent disability, or the need for long-term care. These benefits can help cover expenses like education.

Step-by-step explanation:

An insurer would pay accelerated benefits under specific circumstances. One such circumstance might be if the insured is diagnosed with a terminal illness and has a life insurance policy with an accelerated death benefit rider. This rider allows the insured to access a portion of the death benefit early to use for medical expenses, including college tuition.

Another circumstance might be if the insured is permanently disabled and has a disability insurance policy with an accelerated benefits provision. This provision allows the insured to receive a lump sum or monthly benefit to cover expenses such as education.

Additionally, some long-term care insurance policies offer accelerated benefits if the insured requires long-term care services, such as nursing home care or home healthcare. These benefits can be used to cover various expenses, including educational costs.