Living Benefits

Living Benefits

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Myth: Life insurance is only helpful
when you're dead.

Indeed, the fundamental purpose of life insurance is to provide financial security for your loved ones in the event of your passing. However, it's worth noting that certain policies offer additional benefits known as "living benefits." These living benefits enable policyholders to access the cash value or accelerate the death benefits for their own use while they are still alive.


Living benefits can be invaluable when life takes unexpected turns. Having a life insurance policy with these features can be a financial lifeline during unforeseen circumstances, offering flexibility and additional financial support when you need it most.

Mental Illness
Chronic or terminal illness

Leverage your policy's living benefits to accelerate your death benefit, providing financial assistance for end-of-life care and medical expenses.

Retirement funds shortage
Retirement Funds Shortage

Tap into the cash value of your policy when your retirement savings fall short, helping to ensure financial stability during your Golden Years.

Elderly care
Long-Term Care Financing

Access funds from your death benefit to cover the costs of long-term care, such as nursing home expenses, easing the financial burden on you and your family.

What are living benefits?

As the name implies, living benefits are facets of a life insurance policy that can be utilized while you are still alive. Your policy may inherently include features serving as living benefits, or you may opt to enhance your policy by adding living benefit provisions through a rider.



With a multitude of life insurance products available, there is a diverse range of living benefits to consider. If the inclusion of living benefits in your insurance coverage is a priority, I'm here to assist you in selecting from a wide array of options tailored to your specific needs and preferences.

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What are accelerated benefits?

Accelerated death benefits represent a specific category of living benefits often added to a life insurance policy. This feature allows for a portion of your death benefit to be paid out to you under specific circumstances, such as a terminal illness diagnosis.


Facing a severe illness, like cancer or kidney disease, can rapidly deplete your financial resources. Having an accelerated benefits rider on your term life policy can provide crucial support for paying costly medical bills and long-term care expenses, helping you maintain financial stability. Moreover, individuals sometimes utilize these funds to fulfill personal dreams or create cherished memories with their loved ones.


It's essential to be aware that any accelerated benefits payment will reduce the death benefit that is eventually paid upon your passing. Furthermore, some policies may have a waiting period before you can access this benefit, and there might be interest charges associated with its use.

Types of living benefits:

cash value
Cash Value Component

Many permanent life insurance policies build a cash value that can be withdrawn or borrowed against, and you can opt to surrender the policy for a lump-sum cash value payout. However, how you can use this cash value often comes with restrictions, which vary by policy, so it's vital to closely examine your policy's terms.

accelerated death
Accelerated Death Benefit

This added policy provision, known as a chronic or terminal illness rider, can be included in various life insurance types, such as term life and whole life insurance. It permits you to access a portion of your death benefit while you are alive in the event of qualifying circumstances, though this reduces the amount your beneficiaries will receive upon your passing.

premium rider
Return of Premium Rider

Term life insurance policies typically provide a benefit payout only upon the policyholder's death during the coverage term. However, by incorporating a return of premium rider into a term life policy, you'll have slightly higher monthly premiums, but you'll also receive a predetermined amount refunded to you when the policy reaches its end.

disability waiver of premium
Disability Waiver of Premium

Consider adding a rider to your life insurance policy to ensure continued coverage in situations where you can't pay the premium due to specific circumstances. In the event of a long-term disability diagnosis (typically lasting 6 months or more), this rider can waive your mandatory premium payments, allowing your policy to remain in effect.

long term care benefits
Long-Term Care Benefits

This rider is increasingly popular with permanent life insurance policies, given the rising demand among seniors for covering long-term care costs. Incorporating this living benefit into your policy enables you to access a portion of the death benefit in advance to address long-term care expenses, including nursing home stays or assisted living residence.

Term life insurance with living benefits

Term life insurance typically offers a death benefit to provide for your loved ones in case of your demise, but it's effective for a specific term only. If you outlive the term, you'll need to purchase additional coverage.


For those seeking more comprehensive coverage, term life policies can be customized with optional living benefit riders, often at an additional cost. Potential riders for term life insurance include:


  • Accelerated Death Benefits Rider: Allows you to access a portion of the death benefit if you're diagnosed with a terminal illness.
  • Return of Premium Rider: Permits you to receive a refund of your premiums at the policy's end if no death benefit is paid.
  • Disability Waiver of Premium Rider: Maintains your coverage while exempting you from premium payments if you experience a long-term disability lasting 6 months or more.
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What Are the Living Benefits Of

Whole Life Insurance?

Whole life insurance, with its lifelong coverage and cash value accumulation, inherently provides living benefits. These policies allow you to access the cash value while you're alive, offering an additional source of income for challenging times. You can choose to withdraw funds or take out a loan against the policy, or even surrender the policy in exchange for a lump sum.

The cash value living benefit is a unique feature of whole life insurance policies, providing an advantage over term life policies, which require additional riders to offer similar benefits. Additionally, whole life insurance policies can be further customized with riders, such as those for long-term care expenses, which tap into the death benefit, although this may reduce the final death benefit.

You have the option to:


  1. Leverage the cash value of your whole life insurance, or
  2. Enhance your policy with living benefit riders to access the death benefit.


This flexibility allows you to tailor your coverage to meet your specific needs and financial objectives.

What Is a Living Benefits Rider?

When you purchase a whole life insurance policy, you're often looking to utilize the cash value component. This built-in living benefit allows you to withdraw or borrow against the cash value of your policy as needed.


Riders, on the other hand, are supplementary benefits attached to your life insurance policy. They are valuable for enhancing protection and tailoring your policy to suit your specific requirements. An example of a popular rider is the accelerated benefits rider, which allows the policy to pay out if you are diagnosed with a terminal illness.


If living benefits are added to your life insurance policy via a rider, there may be a slight additional premium, typically calculated as a percentage of the base premium. Many insurance companies are now offering these benefits at no extra premium, charging only if and when the rider is utilized.


Key points to remember about riders:


  • Riders are added coverages on your insurance policy.
  • They enable customization of your life insurance to meet your specific needs.
  • Riders can introduce living benefits but may involve an additional premium.
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When Could I Collect

Accelerated Benefits?

Accelerated death benefits provide financial assistance in critical illness and various situations, including:


  • Terminal Illness: When facing a life expectancy of 6 months to one year.
  • Serious Illness: Such as heart attack, stroke, cancer, kidney or liver failure.
  • Long-Term Care: When you require assistance for daily living.
  • Permanent Nursing Home Confinement: For those in need of ongoing care in a nursing home.


These benefits offer policyholders a way to access a portion of their death benefit while they are still alive, providing valuable financial support during challenging times.

How much of a policy can be collected early?

Accelerated death benefits offered by life insurance companies typically grant policyholders access to a portion of their death benefit, ranging from 25% to 100%, in advance of their passing. The way these early benefits are disbursed can vary, with options including lump-sum payments or monthly installments. Policyholders often have the flexibility to specify their preferred method of payment when the policy is initiated, allowing them to align the benefit payout with their financial needs.

Is life insurance with
living benefits worth it?

Purchasing life insurance with living benefits is a financial decision that carries some uncertainties. There's the possibility of paying for these additional benefits and never needing them. On the other hand, facing a debilitating illness could lead you to wish you had invested in these added protections.


Ultimately, the choice boils down to your budget and your unique circumstances. If you're willing and able to cover potentially higher premiums, it's an option to consider. Moreover, if your family has a history of serious illnesses, preparing with living benefits may be a wise decision.


I'm here to assist you in evaluating whether living benefits are the right choice for you and your family. Together, I'll identify the life insurance solution that aligns best with your specific needs and financial situation.

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Can You Have More Than One Life Insurance Policy?

Indeed, it's entirely possible to purchase multiple insurance policies from different companies. While some insurers may request justification for the coverage amount you're seeking, many providers offer flexibility in terms of the coverage you can obtain.


There are various scenarios where having more than one policy makes sense. For instance, a small business owner might opt for one policy to protect their family's financial future and another to cover business-related loans or a buy-sell agreement with a partner.


Furthermore, you might choose a traditional life insurance policy to provide for your family's immediate needs and complement it with a hybrid or permanent life insurance policy to address long-term care expenses. Your specific financial goals and requirements will determine the best combination of policies, and I'm here to help you navigate these options and find the right coverage or policies to meet your unique needs.

How do I select my beneficiaries?

When you purchase life insurance, designating your beneficiaries is a crucial step. Your choice depends on your objectives, whether it's providing for your family or creating a lasting legacy.

Potential beneficiaries encompass:


  • Spouse or partner
  • Children
  • Parents and siblings
  • Grandchildren and great-grandchildren
  • Other family members
  • Business partners
  • Charities
  • Trust fund


You can allocate the life insurance proceeds among multiple beneficiaries, specifying the percentage each should receive.


It's common for insurance companies to request a contingent beneficiary, serving as a backup in case the primary beneficiary is unable to receive the benefit. For instance, if your primary beneficiary, like your spouse, predeceases you, the contingent beneficiary you've designated would receive the benefit.


Certain policies, such as final expense or mortgage protection insurance, might direct the benefit to entities like funeral homes or mortgage lenders rather than family members. These policies are suitable if you want to allocate your life insurance specifically for such expenses.

Take care of those who matter most

Delaying conversations about life insurance is a common response, as the topic of death can be uncomfortable. Nevertheless, it's crucial to recognize that grief is already a heavy burden for your loved ones, and you wouldn't want to add a financial strain to their difficulties. The good news is that obtaining life insurance can be a straightforward and budget-friendly process, ensuring your family's well-being.

Explore various life insurance options, including:


  • Term life insurance
  • Whole life insurance
  • Universal life insurance
  • Final expense life insurance
  • And more


Regardless of the type of insurance you select, you have the flexibility to specify coverage amounts that not only address final expenses but also secure your loved ones' financial future. By taking this step, you can provide invaluable peace of mind, knowing your family will be well taken care of.

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