Living Benefits in Life Insurance
Life Insurance Isn't Only About Dying
What if a serious illness changed your ability to work and provide for your family?
Life insurance is traditionally designed to provide a death benefit to your beneficiaries. But certain policies also include living benefits, which may allow you to access a portion of your death benefit while you're alive after a qualifying illness or condition.
That money can provide financial flexibility when an illness affects not only your health, but also your income, mortgage, savings, and family.
What Would Happen If Your Income Stopped Tomorrow?
A serious illness doesn't stop your bills.
Your family may still have:
🏡 Mortgage or Rent
💡 Utilities
🛒 Groceries
🚗 Car Payments
💳 Debt Payments
👨👩👧 Everyday Family Expenses
At the same time, you or your spouse may need to reduce work hours or stop working altogether.
Health insurance may help with covered medical expenses.
But what about everything else?
That's where living benefits may help.
If you experience a qualifying event under your policy, living benefits may allow you to access a portion of your life insurance death benefit while you're still alive.
Three Ways a Policy May Protect You While You're Living
Critical Illness
When a serious medical event changes your life.
Depending on the policy, certain qualifying critical illnesses or medical events may trigger an accelerated death benefit. Examples under some policies can include specified: Cancer, Heart Attack, Stroke and other covered conditions. The benefit can provide financial flexibility while you focus on your health and family.
Coverage and qualifying definitions vary by policy.
Chronic Illness
When you can no longer independently perform certain everyday activities.
Certain policies may provide access to benefits when an insured meets the policy's definition of chronic illness.
This can involve being unable to perform a specified number of Activities of Daily Living, such as:
Bathing • Dressing • Eating • Toileting • Transferring • Continence
or meeting applicable cognitive-impairment criteria, depending on the policy.
This can be particularly important when an illness creates a need for ongoing assistance.
Terminal Illness
When time becomes more important than money.
If you're diagnosed with a qualifying terminal illness, certain policies may allow you to access a portion of your death benefit before death.
That can provide financial flexibility during an incredibly difficult period.
Eligibility and life-expectancy requirements vary by policy.
The Benefit Is Flexibility
What Could Living Benefits Help You With?
Instead of telling people they must use the money for medical bills, explain the flexibility carefully.
Depending on the benefit and policy provisions, funds received from an accelerated death benefit may provide resources for needs such as:
🏡 Keeping Up with Your Home
Help manage mortgage, rent, utilities, and other household expenses.
💵 Replacing Lost Income
Provide financial resources when an illness affects your ability to work.
👨👩👧 Supporting Your Family
Help with groceries, childcare, transportation, and everyday expenses.
💳 Protecting Your Savings
Additional resources may reduce the immediate need to rely entirely on personal savings during a qualifying event.
❤️ Focusing on What Matters
Financial flexibility can help families concentrate on their circumstances rather than only on the next bill.
Health insurance may help with medical expenses. Living benefits may help when an illness affects your income and everyday life.
See the Difference
🛡️ DEATH BENEFIT
You pass away
↓
Beneficiaries receive benefit
Protection for the people you leave behind.
❤️ LIVING BENEFITS
Diagnosed with a qualified illness
↓
Access portion of death benefits while alive
Protection that may help while you're still here.
Imagine This...
You have life insurance to protect your family if you die.
But what happens if you don't die?
You survive a serious illness, but you can't work for months.
Your paycheck may stop.
But your family's life doesn't.
🏡 The mortgage is still due.
🛒 Your family still needs groceries.
🚗 The car payment continues.
💡 The lights still need to stay on.
👧 Your children still need to be cared for.
And now your spouse may even need to work less to take care of you.
This is the bigger picture.
Certain life insurance policies with living benefits may allow you to access a portion of your death benefit after a qualifying illness.
It's not just about paying medical bills. It's about helping your family keep going financially while you focus on getting through one of life's most difficult moments.
Eligibility, benefits, and qualifying conditions vary by policy. Accelerating benefits generally reduces the remaining death benefit.
Your Life Insurance Should Answer Two Questions
1. What happens to my family if I die?
That's your death benefit.
2. What happens to my family if I survive a serious illness but can't work?
That's where living benefits may become important.
A good life insurance conversation should consider both.
Living Benefits Are Not Health Insurance
Health insurance and life insurance serve different purposes.
Health insurance generally helps pay eligible healthcare expenses according to the health plan.
Life insurance living benefits may allow access to part of the death benefit after a qualifying event according to the life insurance policy.
You shouldn't think of one as replacing the other. They address different financial risks.
Does Your Policy Have Living Benefits?
Pull Out Your Current Life Insurance Policy.
Can you answer these questions?
Does it include accelerated death benefit riders?
Does it cover terminal illness?
Does it cover chronic illness?
Does it cover specified critical illnesses?
What triggers each benefit?
How much could potentially be accelerated?
What happens to your remaining death benefit?
If you don't know the answers, that's exactly why you should review your coverage.
We'll Help You Understand What You Already Have
Frequently Asked Questions
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Potentially. Certain policies include living benefit provisions that may allow access to part of the death benefit following a qualifying event.
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Certain policies include specified cancers under critical-illness provisions. Eligibility depends on the exact policy definition and severity or other requirements
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Some policies include specified heart attacks or strokes as qualifying critical-illness events. The policy's definition controls eligibility.
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Accelerated death benefits are not necessarily structured as reimbursement for specific medical bills. How benefits can be used depends on the policy and applicable rules.
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Generally, yes. Accelerating part of a death benefit typically reduces the amount remaining for beneficiaries and may affect other policy values.
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No. Features vary significantly by product, carrier, state, and policy
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There is no universal percentage. Available benefits depend on the policy, rider, qualifying event, contractual maximums, and other factors.
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Many policies include certain living benefits at no additional premium cost. However, some carriers, riders, or additional benefits may have a cost. Benefits and terms vary by policy.
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Generally, accelerated death benefits aren't loans that you simply repay. Instead, accessing a benefit typically reduces the death benefit remaining for your beneficiaries and may affect other policy values.
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You must experience an illness or condition that meets the specific definition in your policy and satisfy the carrier's claim requirements. A diagnosis alone doesn't necessarily guarantee eligibility.
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The policy may continue with a reduced death benefit and potentially adjusted policy values, depending on how much was accelerated and the terms of the contract.
Don't Wait Until You're Sick to Find Out What Your Life Insurance Covers.
The time to understand your coverage is before you need it.
Whether you already have life insurance or you're looking for a new policy, we'll help you understand the available options and what your coverage actually provides.
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