Living Benefits

[margostl]

I have a question, wrote a policy on a client ,16months into policy got a terminal illness diagnosis
.Filed a claim and carrier ruled in their favor.My question is are those benefits taxable? Normally I would say no for life beneficiary, but not sure regarding this.On the detail page of policy it states ask your tax consultant, they did and she did not know either.Client will decide whether to take lump sum or 1/3 based on taxes.
Thanks in advance.

 

[pfg1]

I have a question, wrote a policy on a client ,16months into policy got a terminal illness diagnosis
.Filed a claim and carrier ruled in their favor.My question is are those benefits taxable? Normally I would say no for life beneficiary, but not sure regarding this.On the detail page of policy it states ask your tax consultant, they did and she did not know either.Client will decide whether to take lump sum or 1/3 based on taxes.
Thanks in advance.

You need to ask the company if they will issue your client a 1099. It is technically an advance of the (tax free) death benefit, so in theory it should not be. Call them and let us know what they say.

 

[margostl]

Follow-up, Spoke with claims dept. Benefits will not be taxed.My first Accelerated claim, I will definitely continue to market it with this company as my first go to.American National/Standard Life

Thanks again

 

[pfg1]

Thats good, its the way its supposed to work. The claim I had a couple years ago was tax free as well - with LSW.

 

[Carlos Edwin]

Do you know if Nation Wide has living benefits? Critical, Chronical and Terminal illnesses?

 

[Cornelius]

WebCe has a continuing ed course on living benefits.