Chronic Illness Rider for Life Insurance Policies

This document is a guide that details the Chronic Illness Rider available on Income Advantage and Life Protection Advantage Indexed Universal Life (IUL) policies. It outlines how this rider can serve as an alternative for clients who may not have long-term care coverage due to affordability or qualification issues. The guide explains the benefits of the rider, including the ability to access funds for long-term care expenses without depleting personal savings. It describes the payout structure, which allows for a lump-sum payment up to the IRS per diem limit, and clarifies that there is no upfront cost for the rider. However, if the benefit is utilized, an actuarial discount and a flat fee apply. The document also provides a case study illustrating how the rider works in practice, detailing the process for a client diagnosed with a chronic illness, including the calculation of benefits and the impact of the actuarial discount on the payout amount.