Cash Benefit
What Does 'Cash Benefit' Mean?
A Cash Benefit will pay a cash benefit, paid directly to the insured, once a person qualifies for benefits. With some policies, this can be the full benefit or a reduced benefit instead of the full reimbursement benefit offered by the policy.
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In Long-Term Care Insurance, a cash benefit is when insurance benefits are paid directly to the insured in cash.
Specific cash benefit rules depend on the policy. For example, some policies will pay out the full benefit amount in cash as soon as the individual qualifies for benefits.
Other policies will pay a reduced cash benefit amount instead of the full reimbursement amount. Even still, some policies pay out a portion in cash benefits in addition to a normal reimbursement amount paid to a care provider.
Cash benefits can be useful for insured individuals because they allow flexibility in their use. For example, an individual could use their cash benefits to reimburse informal caregivers for their contributions. They could also use cash benefits to pay for care that their policy may not cover.