It’s all in the Details
Understanding the Value of the New “Accelerated Benefit to Age 65” Plan:
For decades, Petersen International has employed the use of Lloyd’s of London’s lump sum disability benefits in combination with monthly benefits to best simulate the long term benefit periods of “traditional” non-cancellable disability policies written by U.S. carriers. The Lloyd’s model has always used a limited duration monthly benefit period followed by a lump sum payout.
The shortcoming of the usual lump sum benefit is that the trigger for disability is based on a permanent total disability definition. If we examine the wording more closely and focus on the “permanent” portion of the definition, we discover that, confirmed by a competent medical authority, the insured must have no chance of recovery in his or her occupation to be deemed permanently disabled and be eligible for the benefit.