Life insurance policies can be quite the windfall for so many individuals, acting as precautionary measures for the ones that you love when you pass away. Especially with any serious illness, you can never be too sure about preparing your family for whatever happens in the future.
Now, do keep in mind that there are different subcategories, and some may fit the bill for you. Life insurance with living benefits is often recommended to patients who may be dealing with certain diseases or medical conditions. If you’d like to learn more, keep reading this little introduction to life insurance with living benefits.
Definition of Life Insurance with Living Benefits
Life insurance with living benefits, also referred to as accelerated death benefits, is a certain life insurance policy that can allow a patient to access certain death benefits during their life. Most of the benefits are provided after death, but there’s a special exception wherein riders provide funds to cover end-of-life expenses at the hospital and the like.
Living benefits riders refer to the additional coverage that’s on your basic life insurance policy. The terms and amount provided can depend on how severe one’s illness is and the care needed. Having and using these funds right away can protect your family from having to shell out money during these times.
Options of Life Insurance with Living Benefits
The living benefits riders aren’t the only option on a life insurance policy. Some may come in cash value funds, which are available in several different options. There are premium payments, paid additions, and more that help you get cash.
The terms and conditions may differ depending on the insurance provider that you deal with. Riders are still recommended as the best living benefits as some cash value interest rates may be too low.
Kinds of Life Insurance with Living Benefits
Aside from having other options, keep in mind that there are all kinds of living benefits riders. Not every patient is going to have the same circumstances as another, so some may need certain riders more than others. Here’s the classification of living benefit riders:
- Chronic Illness. Chronic illness riders are given if a patient can only perform two daily living activities. Eating, bathing, dressing, continence, toileting, and moving are all considered as a measure of how a patient is coping with their illness.
- Long-Term Care. Long-term care riders are usually given when someone sick is no longer able to do any activities of daily living. This kind of life insurance with living benefits is considerably more expensive than the others, though.
- Critical Illness. Critical illness riders are awarded when a patient is slammed with higher medical costs and a shorter life expectancy. The coverage changes according to the provider, but common diseases under this kind of rider are ALS, cancer, and stroke.
- Terminal Illness. Terminal illness riders roughly have the same conditions as critical illness riders. The difference is in the timeline, as patients with a terminal diagnosis where they have just two years or less left to live are given this rider instead.
Life insurance with living benefits can be really helpful for those battling diseases to cover any medical bills that can affect their loved ones while they’re still battling and coping with the conditions. It’s also great preparation and help for when your time to go finally comes.
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