The Penn Mutual Life Insurance Company, Horsham, Pa., has introduced a new living benefit for permanent life insurance policyholders who become chronically ill: The Chronic Illness Accelerated Benefit. This protection is designed to provide permanent life insurance policyholders with the option to access a portion of their policy death benefit to provide an additional resource to help assist with the daily needs of a chronically ill individual. There is no charge for the benefit and no impact on the policy values unless it is used.
The Chronic Illness Accelerated Benefit can help pay for personal, medical, nursing home and household expenses. It can also aid in covering the cost of special equipment or modifications to a living space. There are no restrictions on how the money can be used.
Access to this benefit is subject to a waiting period that in most states is two years. After that time, a licensed health care practitioner must certify that the policyholder is unable to perform two of the six activities of daily living or suffered from a severe cognitive impairment for at least 90 consecutive days within the previous 12 months. Activities of daily living include: bathing, continence, dressing, eating, toileting and transferring.