Starting in 2025, the per diem limit for chronic death benefit riders will increase to $420 per day.
The Internal Revenue Service (IRS) has announced changes for per diem limitations on periodic payments from qualified long-term care insurance policies and certain life insurance policies offering accelerated death benefits for chronic illness care.
In 2025, the per diem limit for these policies will increase from $410 to $420. This change allows clients to access up to $12,600 of their policy's death benefit each month through ExtendCareSM, a chronic illness protection rider available with the purchase of new universal life insurance policies from Protective. The new per diem limit applies to policies issued with a 2025 effective date.
About ExtendCare
ExtendCare is an optional rider that enables clients to advance their policy's death benefit for chronic illness needs. If the insured becomes chronically ill1, as certified by a licensed physician, the death benefit can be accessed after a 90-day waiting period.2 This rider is available only at policy issue at an additional cost.
With ExtendCare, clients can:
- Access up to $12,600 monthly
- Receive direct monthly benefit payments
- Cover family and informal care
- Use benefits for medical or non-medical expenses
- Cover expenses without proof of care
- Leave any unused death benefit to loved ones
For more information about ExtendCare, please contact your Protective Life representative.
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1 Chronically ill is defined as being unable to perform at least two of six Activities of Daily Living without assistance for 90 days, or requiring supervision for protection against health and safety threats due to severe cognitive impairment.
2 A 90-day waiting period must pass between the time the company receives written certification of the insured's chronic illness status and the time the first accelerated death benefit (ADB) payment is made.
This is only a summary of ExtendCare benefits. Actual terms and conditions contained in the rider govern all benefits provided. Please see the rider for more detailed information. Available only at issue and at an additional cost. Assumes medical and financial underwriting qualifications at time of initial application.
ExtendCare falls under IRC Sec. 101(g) Accelerated Death Benefit guidelines and does not fall under health regulations. This differentiation could affect eligibility for public assistance programs such as Medicaid, Supplemental Income, or others. Purchasers should consult a qualified advisor along with legal or tax advisor to determine if the rider will affect their initial or continued eligibility for public assistance programs or other tax-related decisions.
ExtendCare (ICC12-L630 and L630) is issued by Protective Life Insurance Company (PLICO) which is located in Nashville, TN. Subject to underwriting and up to a 2-year contestable and suicide period. Benefits adjusted for misstatements of age or sex. Consult policy for benefits, riders, limitations and exclusions. In Montana, unisex benefits and rates apply. Policy form numbers, product features and availability may vary by state. PLICO does not render legal or tax advice. Information in this summary is based on current tax laws that are subject to change. Individuals should consult their attorney or tax advisor regarding their individual situation.