What Are Living Benefits?

When shopping for life insurance, the term “living benefits” comes up frequently. So, what are living benefits? Jerry Angel, the life and financial expert, explains why the “new” life insurance policies are better than the “old.” Watch the video below to learn about living benefits and how they truly are a benefit to policyholders.

What Are Living Benefits?

A common question that we like to ask is, “Do you have the old policy or the new policy?” Many life insurance policies that weren’t written up until a few years ago did not have any additional benefits for them with the exception of the death benefit. When a person dies, they of course pay the family the death benefit. Now , however, the life insurance policies can do a much bigger service for the client. Now, there are attached three living benefits.

Regarding the three living benefits, the first one is for terminal illness. If someone is diagnosed with a condition and has a life expectancy of only a few years, then they can use the death benefit ahead of time to help with expenses. The second one is the critical illness benefit. Critical illness includes cancer, strokes, or heart attack. Again, they can take part of the death benefit and apply it to their medical expenses.

The last one is the chronic illness benefit. It’s probably one of the most popular because it deals with long-term care. People are really quite concerned about long-term care so consequently they can use part of their death benefit. In fact, most companies have set it up so that you can use the majority of the death benefit for the purpose of helping pay for long-term care and the surplus of costs, especially since they are extremely expensive. So bottom line, the new policies contain terminal, critical, and chronic illness benefits, and they really are a benefit to the client.

Since insurance is oftentimes overwhelmingly confusing, we want to shed light on this industry by answering YOUR questions.  So if you have any questions or concerns, comment below and your question may be the topic of our next video!

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