Those who have been diagnosed with a terminal illness may be able to tap into financial resources during this difficult time through their term life insurance policy.
NASDAQ reports some terminally ill patients may be able to access a portion of their policy's death benefits while they are still alive. Known as accelerated death benefits, this type of financial tool is usually written into both whole and term life insurance policies. The amount consumers may withdraw varies depending on the company with which they have a life insurance policy and in which state they live, said the report.
Some companies allow patients to withdraw up to half of a policy if they provide written medical proof that they only have six months to live, said the report. Others might be able to tap into the benefits earlier if they have not passed their conversion period on a term life insurance policy, the report added.
Policyholders should be aware tapping into this fund could limit what's left for their family after they pass away.
Though it can be a morbid topic, experts advise consumers discuss matters like accelerated death benefits well before they might actually have to use them, as it can help clear up confusion and develop a plan of action for their families to take during a difficult time.