Accelerated death benefit riders (“ABR”) and long-term care insurance (“LTCI”) provide different types of benefits. Foresters ABR is a rider attached to a life insurance certificate. It provides the opportunity for the owner to accelerate a portion of the certificate’s death benefit, if the insured is diagnosed with a chronic, critical or terminal illness, and receive a payment that can be used for any purpose. Payments are not linked to, nor do they require proof of, medical expenses being incurred. A payment under ABR reduces the death benefit payable under the life insurance certificate and may affect other benefits and values, but if no payment is made the certificate’s benefits and values are still available, as long as the certificate remains in effect. The accelerated death benefit will terminate with the certificate or earlier.
Generally, LTCI provides reimbursement payments for expenses incurred, due to a prolonged or permanent illness or disability, and provides no death benefit or cash value. LTCI benefits are typically based on evidence that the insured has incurred qualified long-term care expenses and the benefit, which may be subject to a maximum, is equal to the amount of expenses incurred. If LTCI benefits are not claimed they may be forfeited.
There may be other differences between Foresters ABR and a specific LTCI product that you may want to consider before making a decision to purchase.