Insurance question about a Critical Illness rider.?
I plan to ask my insurance agent this too but his mother just died so will talk to him next week or 2. In the mean time I am evaluating the plan. I am getting a 0k Term policy for 20 years. It also includes a Critical Illness rider for k. Which brings up my question.
The Quote for Critital Illness rider states "… This rider gives the owner access to a portion of the death benefit if the insured is diagnosed with a life threatening…." Ok I understand what it covers but what I am not clear on is If I do come down with a Critical Illness does that mean that the k will be taking out of my 200k death benefit? Or is it an additional 50k on top of my 200k policy. I’m sorry for such a question where the answer seems obvious but just wanted to make sure I got this right.
Thanks,
December 22nd, 2009 at 5:07 PM
The way the rider is written, it acts as an accelerated death benefit giving you access to a portion of your death benefit. This would take away $50K from your death benefit if the rider were excercised. FYI - this is a crappy rider. Most CI riders give an additional benefit. You also need to look at what the company calls "Critical Illness". There are various definitions and coverages are widespread. A good policy will cover the big three: cancer, heart attack, stroke; but should also cover 6-8 other major illnesses as well. If it doesn’t, hold out for something better.
December 22nd, 2009 at 5:07 PM
I used to work in the insurance industry and I believe that its an additional $50k.
December 22nd, 2009 at 5:07 PM
It is taken out of your 200k total so you can take care of bills or travel or whatever while you are still alive. The remaining 150k will go to your beneficiary after your death.
December 22nd, 2009 at 5:07 PM
It gets taken out of the face value of the policy.
December 22nd, 2009 at 5:07 PM
It means 50K will be taken out of your 200K in advance of death. want to know the sad thing? 50K is nothing in healthcare, especially for a terminal or critical condition. That’s about 5 days in ICU, if not less.