As a life insurance policy owner may use accelerated death benefit payments for food or shelter, these payments are income when received and resources if retained into the following month. This transaction is not a conversion of a resource.
If an individual receives accelerated death benefit payments, and the payments do not preclude SSI eligibility due to excess income or resources, determine whether the FV and/or CSV of the life insurance policy must be re-verified.
Re-verify the life insurance policy if, prior to receipt of the accelerated death benefit payments:
the value of the life insurance policy's CSV precluded SSI eligibility, but the individual may now be eligible; or
the life insurance policy was an excluded resource and its FV reduced the maximum burial fund exclusion available to the individual. (For a definition of burial insurance, see SI 01130.300B.4.).
If re-verification is necessary, evaluate the life insurance policy and any other relevant documentation in the policy owner's possession to determine the effect of the accelerated payments on FV and CSV. If necessary, contact the life insurance company for the required information.
If the policy owner expects to receive accelerated death benefit payments in the future, explain the effect of any further reduction in the policy's FV on the maximum burial fund exclusion available (if applicable).