Generally, two methods are used to make disability buyout payments:
On the one hand, if the installment method is used and the insured recovers during the benefit period, payments under the buyout will stop. On the other hand, if the lump-sum method is used and the insured either recovers or dies soon after the agreement is triggered, the full benefit amount will have been paid.
Thus, in many cases, clients consider the lump-sum method to be the more attractive of the two benefit payment arrangements.
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