Living Benefits

Jun 11, 2019

  1. margostl
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    margostl Expert

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    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.
     
    margostl, Jun 11, 2019
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  2. pfg1
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    pfg1 Guru

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    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.
     
    pfg1, Jun 12, 2019
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  3. margostl
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    margostl Expert

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    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
     
    margostl, Jun 20, 2019 at 12:24 PM
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  4. pfg1
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    pfg1 Guru

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    Thats good, its the way its supposed to work. The claim I had a couple years ago was tax free as well - with LSW.
     
    pfg1, Jun 20, 2019 at 6:49 PM
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