What Does Terminal Illness Benefit Mean?
A terminal illness benefit is an extra feature found on some life insurance policies. With this benefit, if the insured is diagnosed with a terminal illness and their life expectancy is less than one year, they can choose to receive the death benefit payment from their life insurance while they’re still alive. This feature differs from most other life insurance policies, where the death benefit can only be paid out once the insured has died.
Note that life insurance companies outside the United States tend to use this term. In the United States, this benefit is described as the accelerated death benefit.