INDIVIDUAL PLANS
If these two conditions are met, the company typically pays you a percentage
of the value of your policy, not exceeding 50 per cent. Some companies pay
predetermined maximum dollar amounts in living benefits . Others treat the living
benefits payment as an advance or loan and charge interest on it. Still others
require you to pay regular premiums to keep your policy in force after you receive
the benefits.
When you die, the amount that is left in your life insurance policy, less any interest
charges, will be paid to your beneficiary or estate.
Selling your life insurance policy to a viatical settlement company for a cash
payment is another option in some provinces. The payment – which is taxable –
is usually much less than the death benefit of the policy, and you must name
the company as your beneficiary and give up all your rights under the policy.
When you die, the company claims the full death benefit, leaving your intended
beneficiary with nothing.
The life and health insurance industry recommends that you find out whether you
qualify for living benefits from your life insurance plan before you accept an offer
from a viatical settlement company.
Long-Term Care Insurance
A few companies offer individual long-term care insurance plans, which pay for stays
in nursing homes and chronic care facilities, or for the services of a caregiver in your
own home.
When deciding whether to purchase such insurance you should consider your age,
health and financial resources, along with any support you could expect from family
and friends should you need long-term care.
There are variations among longterm care policies. Inquire about the maximum
lifetime payout, inflation protection, and the length of time you must pay premiums.
You should also find out whether your premiums are waived, or discontinued, when
you make a claim and are receiving benefits.
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