Living Benefits

Also known as accelerated death benefits, living benefits are insurance riders added to life insurance policies to allow terminally ill patients or those with certain medical conditions access to a portion of their life insurance benefits before they die.

Living Benefits
Living Benefits

Typically paying out 50 to 80 percent of a policy’s face value, these funds are distributed by the insurer either in lump sum or in the form of monthly payments, and may be used to help pay medical bills, start an education fund for children, take a vacation or any other purpose the policyholder wants to use them for.

Living benefits are often included in life insurance policies automatically at little or no cost, and may be added at the time the policy is purchased or any time afterward.

Their income is usually received tax free and may be accessed when:

1. You have a terminal illness and death is likely to occur within a specified period
2. You become permanently confined to a nursing home
3. You are no longer able to perform activities of daily living on your own

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