Life insurance with living benefits
Protection for the people you love—and for life’s unexpected turns.
Life insurance is designed first to provide a death benefit. Some policies also include optional riders that may let you access part of that benefit during your lifetime after a qualifying illness or injury.
How living benefits work
Living benefits are commonly provided through Accelerated Benefits Riders. When a covered event meets the policy’s requirements, the policyholder may request access to a portion of the life insurance death benefit on a discounted basis.
After a claim is reviewed and approved, the benefit is generally paid directly to the policy owner. Except where state rules impose restrictions, the money may be used for needs such as household expenses, in-home assistance, adult day care, assisted living, home modifications, or other regular bills.
Qualification is not automatic. Each rider defines the covered events, required medical certification, waiting periods, filing deadlines, and benefit limits. Availability also varies by product and state.
A financial safety net
Coverage may be available when a qualifying event changes the plan.
01
Terminal illness
A terminal illness rider may allow access to a portion of the death benefit, on a discounted basis, when an insured person has a qualifying condition expected to result in death within the period defined by the policy.
02
Chronic illness
A chronic illness rider may provide access after a qualifying inability to perform everyday activities or following qualifying severe cognitive impairment. Definitions, certification requirements, and waiting periods are set by the policy.
03
Critical illness
Certain diagnoses, such as qualifying cancer, heart attack, stroke, or other covered conditions, may make an accelerated benefit available. Covered conditions and claim requirements vary by state and policy.
04
Critical injury
Qualifying injuries may include conditions such as coma, paralysis, severe burns, or traumatic brain injury. The benefit available depends on the policy terms and the effect of the condition on life expectancy.
Retirement planning
Help protect the assets your retirement depends on.
A serious illness or injury can create expenses at the same time income may be disrupted. Without another source of funds, a household might need to draw from retirement accounts earlier than planned, sell other assets, or take on debt.
If a policyholder qualifies, living benefits may provide another source of money for those costs. That flexibility may help reduce pressure on retirement savings and allow long-term assets to remain positioned for their intended purpose.
Certain permanent life insurance policies may also build cash value that can be accessed through loans or withdrawals. Some policies offer optional lifetime-income features when policy and eligibility requirements are met. These strategies require careful funding and ongoing review.
Important considerations
Accelerated benefits are not long-term care insurance and are not a substitute for it. These riders are appropriate only when life insurance is also needed.
Accelerating benefits, taking withdrawals, or using policy loans reduces available cash value and death benefits and may affect other riders.
Benefits may be taxable and may affect eligibility for public-assistance programs. Consult qualified tax, legal, and social-service professionals.
Policy guarantees depend on the claims-paying ability of the issuing insurance company. Rider availability, definitions, limits, and costs vary.
Educational information based in part on National Life Group’s “Life Insurance with Living Benefits” brochure, TC137152(1023)1. The referenced riders are issued and underwritten by Life Insurance Company of the Southwest. Riders are optional and may not be available in all states or on all products. Life Insurance Company of the Southwest is not an authorized insurer in New York and does not conduct insurance business in New York. Review the applicable policy and rider forms for complete terms.
Start with the need