Terminal Illness Benefit
Many life insurance policies have a no extra cost, inclusive benefit, called 'terminal illness benefit'.
Terminal illness benefit should not be confused with critical illness cover.
Terminal illness benefit means that If you are diagnosed as having less than 12 months to live, your life insurance pays out before you actually die. It is simply an advance payment of the death benefit.
A term insurance policy usually has the terminal illness benefit ending 18 months before the term insurance ends.
This means that there would be no advance payment of the death benefit in the last 18 months, if you diagnosed as being terminally ill in the last 18 months. If you die before the end of the term, it will pay out in full.
