Life Insurance That Pays You While You're Alive

Living benefits and cash value: two different kinds of access

An accelerated death benefit may let you receive part of your death benefit after a qualifying terminal, chronic or critical illness, if that benefit is included in your policy. It reduces what remains for beneficiaries. The diagnosis alone does not establish eligibility: the rider's definitions, conditions and limits matter.

Some term policies offer these riders without building cash value. Permanent coverage may also build cash value, which is a separate feature. Borrowing against it creates a policy loan with interest; unpaid loans and interest reduce the death benefit. Availability, waiting periods and costs vary by policy and state.

Before choosing coverage, compare which events qualify, how a payment is calculated, what remains for your family and whether the premiums fit your budget. Our guide to using living benefits explains the questions to bring to a review.