Life insurance is there to protect your family financially after you’re gone. But what if you need the money sooner? Some life insurance policies allow you to accelerate the death benefit or access your cash value early, an option called “living benefits insurance.” If you’re wondering “what is living benefits insurance,” here’s how term life insurance with living benefits works.
Table of contents
- What is term life insurance with living benefits?
- Who needs life insurance with living benefits?
- What is whole life with living benefits?
- Still need help?
What is term life insurance with living benefits?
Typically, term life insurance provides a cash payout to help support your family financially after you die. Your loved ones can use this payout to pay bills and debt, save for the future, or cover any other needs.
Many life insurance companies also offer riders, or optional coverages or benefits, to your policy so you can customize it to your needs. You can add a rider to an existing policy or a new one, typically for an extra cost. One of the most common riders is a living benefits or terminal illness rider, also known as an accelerated death benefit rider.
A living benefits rider allows you to access a portion of your payout while you’re still alive if you’ve been diagnosed with a serious condition. Since serious illnesses can quickly drain your finances when you’re faced with big medical bills or long-term care, a living benefits rider can help you meet those expenses and keep your family afloat financially.
To qualify, your condition must fall under the list of illnesses that your rider covers, which may vary by provider. Once you’ve been approved, you can use the money however you choose.
Who needs life insurance with living benefits?
Your needs depend on your unique situation and health. Consider your health history: Does Alzheimer’s, cancer, or another serious illness run in your family? If so, a living benefits rider may be a good choice.
If you’re diagnosed with a terminal illness, it’s important to make sure you and your family are prepared. Getting coverage with a serious condition can be difficult, so you’ll want to make sure you’re ready ahead of time with accelerated death, or a living benefit rider. A living benefit rider, which allows someone to get the payout from accelerated death benefits, can offer extra peace of mind, whether or not you end up needing it, just like regular term life policies.
What is whole life with living benefits?
Whole life insurance offers lifelong coverage and also accumulates tax-deferred cash value over time. Whole life with living benefits simply means that you get to access that growing cash value while you are still alive.
Cash value can provide an extra income source for you and your family to tap into. You can borrow against it or use it as collateral if you need extra money for expenses. While whole life policies are more expensive than term life insurance, they can provide permanent protection and extra support if the worst happens.
We’re here to help
At Fidelity Life, we want to help you prepare for whatever the future may hold and we’re here to walk you through the process of getting life insurance with living benefits. Our terminal illness rider offers an extra financial cushion for you and your family when you need it most. Give us a call or start your online quote today.
At Fidelity Life, our goal is to make life insurance simple, affordable, and understandable for everyday families. This content is intended for educational purposes only. Each post is carefully fact-checked, reviewed, and updated regularly to ensure the information is as relevant as possible.
