iQuanti: Accelerated Death Benefit Riders are life insurance top-ups that can allow you to access your death benefit during your lifetime. These endorsements are designed to provide you and your loved ones with financial assistance if you are diagnosed with a terminal illness.
Accelerated death benefit riders are available to complement many types of life insurance policies. But keep in mind that you need to meet a few eligibility criteria to be eligible for payment. Let’s take a closer look at who may be eligible for accelerated death benefit riders and what types of plans offer this feature to help you find a life insurance quote which is suitable for your needs.
Who may be eligible for an Accelerated Death Benefit Rider?
Many policyholders who purchase a life insurance policy are eligible for an accelerated death benefit rider. If it’s not included in your policy, you can usually add it for an additional fee.
Generally, you may be eligible for an early death benefit payment if you contract a terminal illness and your life expectancy is reduced or if you are incapacitated for an extended period.
Which policies offer accelerated death benefit riders?
Many types of policies offer accelerated death benefit riders, including:
Term life insurance
Term life insurance policies provide coverage for a specific period of time, usually 10 to 30 years. Premium payments tend to be cheaper than permanent life insurance premiums, making these plans an affordable option for policyholders. But keep in mind that once the term of the policy ends, you will need to purchase a new policy to continue being covered.
Whole life insurance
Whole life insurance is a type of permanent policy, which means it offers guaranteed lifetime coverage. A portion of each premium payment is allocated to a cash value growth component, which grows tax-deferred at a fixed rate of interest. Once you’ve accumulated enough cash value, you can withdraw, borrow or surrender your policy for the full amount minus the surrender charge.
Variable life insurance
Variable life insurance is a type of permanent life insurance policy with adjustable premiums and death benefits. Additionally, you can invest your cash value in stocks, bonds, mutual funds, and other assets. This can help you potentially increase your cash value faster, but you can also risk losses.
Types of Accelerated Death Benefit Riders
There are several types of accelerated death benefit riders, each designed for slightly different purposes. Here’s how each type works:
Critical illness riders
Critical illness riders pay a significant portion of your death benefit, usually as a lump sum, if you are diagnosed with a major health condition like a heart attack, stroke, or cancer.
Chronic illness riders
Chronic illness riders are paid if you have become disabled and incapacitated for a long period of time in a way that prevents you from performing basic activities, such as eating and dressing. Payments for these riders can be made annually or in a single payment.
Terminal illness riders
Terminal illness riders allow policyholders to access their death benefit sooner if they are diagnosed with a terminal illness such as cancer or end stage kidney failure. This payment can allow you to cover your expenses before your death.
Long Term Care Riders
Long-term care riders provide additional coverage for the costs of long-term care or nursing home care. With these types of endorsements, payments can be monthly. Keep in mind that long term care riders will cost more and require separate underwriting.
The bottom line
Life insurance doesn’t just support your family after you die. With the Accelerated Death Benefit Rider, your policy can provide you and your family with financial assistance if you are diagnosed with a critical illness.
With that in mind, it’s smart to shop around when looking for life insurance quotes. Make sure the policy you choose comes with one of these endorsements so you have the ability to provide your loved ones with additional financial security.
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Can I qualify for an Accelerated Death Benefit Rider?