LoD terrain

Make sure you have setup streaming distances. Sub-levels streaming distance is set in layers (top bar in world composition minimap window). By default all sub-levels assigned to ‘Uncategorized’ layer, which has streaming distance = 50000 units, which is 500 meters. When your camera is further than that distance sub-level will be replaced with simplified version, if it has one.
You can create your own layers with your own streaming distance and assign sub-levels to it. Just add a new layer by clicking ‘+’ button, load sub-levels -> right click on them -> assign to layer -> save.
Simplified sub-levels also have their streaming distances, which can be specified in LOD details panel, when camera is further than that distance simplified sub-level will be unloaded.