Living Benefits
Life Insurance May Help You While You're Living
Most people think life insurance is only designed to provide money to their loved ones when they die. But certain life insurance policies may also provide Living Benefits that can be accessed while you're alive after a qualifying illness or other covered event.
What You'll Find in This Section
We'll explain three important types of protection:
Accelerated Benefit Riders (ABRs)
Benefits that may be included with certain eligible life insurance policies for qualifying events such as terminal illness, chronic illness, critical illness, or critical injury.Premium Chronic Care
Enhanced chronic illness protection available with certain policies for an additional premium or charge.Long-Term Care (LTC)
Coverage designed specifically to help with qualifying long-term care needs, including certain solutions that combine life insurance + LTC protection.The important thing to know: Not all Living Benefits are the same. Some may be included with eligible policies, while others provide additional protection for an additional cost.
1. Accelerated Benefit Riders (ABRs)
Benefits That May Already Be Included With Your Life Insurance
Certain life insurance policies offer Accelerated Benefit Riders, sometimes referred to as Living Benefits. If you experience a qualifying event, these riders may allow you to access a portion of your life insurance death benefit while you're still alive. Depending on the insurance company and policy, benefits may be available for:
Terminal Illness
May provide access to a portion of the death benefit if you meet the policy's definition of a qualifying terminal illness.
Chronic Illness
May provide access to benefits if you meet the policy's requirements for a qualifying chronic illness.
Critical Illness
Certain policies may provide benefits following specified qualifying illnesses such as certain cancers, heart attacks, strokes, or other conditions defined by the policy.
Critical Injury
Some policies may also provide benefits following certain qualifying serious injuries.
Are These Benefits Included?
Sometimes certain carriers include eligible Accelerated Benefit Riders with the policy without an additional upfront rider premium, although charges, discounts, administrative fees, or other adjustments may apply when benefits are exercised. The benefits available depend on the carrier, policy, state, age, underwriting, and rider provisions.
Learn More About Accelerated Benefits
2. Premium Chronic Care
Additional Protection for a Qualifying Chronic Illness
Some life insurance companies offer an enhanced chronic care rider for an additional premium or charge. This is different from simply assuming that every life insurance policy includes the same chronic illness benefits. Depending on the rider, benefits may be structured to provide monthly benefits when the insured meets the rider's definition of a qualifying chronic illness. For the Premium Chronic Care Rider we've been reviewing, qualification generally involves being unable to perform at least 2 of the 6 Activities of Daily Living without substantial assistance for at least 90 continuous days, or requiring substantial supervision because of severe cognitive impairment.
The 6 Activities of Daily Living
Bathing
Eating
Dressing
Toileting
Transferring
Continence
Why Consider a Premium Rider?
A client may want more than the Living Benefits automatically available with a policy. An additional-premium rider may provide a more specifically designed chronic-care benefit, depending on the product.
Learn More About Premium Chronic Care
3. Long-Term Care (LTC)
Life Insurance + Protection for Future Care Needs
Long-Term Care protection is another category. Certain life insurance solutions can combine a life insurance death benefit with benefits designed specifically for qualifying long-term care needs. For example, Nationwide CareMatters® II is LTC coverage linked to a universal life insurance policy. Nationwide states that the policy provides benefits whether LTC is ultimately needed or not. Depending on the policy, LTC benefits may help with services such as:
Home care
Assisted living
Adult day care
Nursing home care
Hospice care
Qualifying care from family or friends
CareMatters II, for example, includes these types of care options subject to its policy requirements.
What If You Never Need Long-Term Care?
With a linked-benefit policy such as CareMatters II, if LTC is never needed, a death benefit can be available for your heirs, subject to the policy provisions.
Learn More About Long-Term Care
What's the Difference?
What's the Difference?
One Policy Doesn't Automatically Include Everything
This is one of the most important things to understand. A policy that includes an Accelerated Benefit Rider for chronic illness is not automatically the same as a Premium Chronic Care Rider or Long-Term Care coverage. Each has its own:
Definitions
Qualifications
Benefits
Costs
Limitations
State availability
That's why comparing the actual policy and riders matters.
Which Type of Protection Is Right for You?
There isn't one answer for everyone. Your options can depend on:
Your age and health
How much life insurance you need
Your budget
The benefits you want while living
Your concerns about chronic illness
Your long-term care plans
The products available in your state
A licensed insurance professional can help you compare available policies and understand exactly what is included, what costs extra, and what has to happen before a benefit can be accessed.
Understand Your Options Before You Choose Your Policy
Talk to a Licensed Insurance Agent
We can help you explore available Life Insurance, Living Benefit, Chronic Care, and Long-Term Care options.
Important Information
Living Benefits, Accelerated Benefit Riders, chronic illness benefits, Premium Chronic Care riders and Long-Term Care benefits are not available with every policy or in every state. Benefits, definitions, eligibility requirements, costs, benefit amounts and limitations vary by insurance company, policy and rider. Some riders may be included with eligible policies while others require an additional premium or charge. Accelerating life insurance benefits generally reduces the remaining death benefit and may affect cash value or other policy benefits. Long-Term Care and chronic illness benefits are subject to their respective qualification requirements and policy provisions. Consult a licensed insurance professional regarding the specific products and benefits available to you.