The CAO must identify and verify life insurance owned by a budget group member or a legally responsible relative (LRR) living with the budget group. The CAO must not count the face or cash surrender value of these policies as a resource of the budget group in determining eligibility. The CAO must count the cash received at the time the policy is cashed in as a resource, if it is not otherwise exempt.
The CAO must explore the possibility that there may be life insurance other than individual policies. This may be the case if the person is or was:
employed;
a member of a lodge or fraternal order;
a member of a union; or
a veteran.
The following are the most common types of life insurance:
Whole life insurance
Term life insurance
Universal life insurance
Reviewed December 11, 2017. Reissued September 20, 2012; replacing January 31, 2012.