An optional rider on some life insurance policies that allowed the policyholder to accelerate the death benefit if the insured suffers from a permanent chronic illness. Acceleration is treated as a lien against the policy, similar to a policy loan, and may be charged interest at a rate declared by the company.
Examples of such illnesses include cancer, heart attack, stroke, or severe cognitive impairment which prevents the insured from performing 2 of the 6 acts of daily living (ADLs).
For this rider to be triggered, the insured must suffer a permanent illness, or an illness which the insured is not expected to fully recover from. Most chronic illness riders pay either a lump sum amount or allow for installment payments either monthly or up to a set number of advances per year. This money may be used to pay for any expense, and there is no need to track or send receipts to the insurer for reimbursement.
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