life insurance policy with living benefits

You have one main reason for purchasing life insurance. It is to ensure that your loved ones receive funds after you pass. That's only a part of the story.

Rider for terminal illness:

Life insurance riders are added to a life insurance policy that provides living benefits. These are also known as accelerated funeral benefits. They're available on both permanent and temporary life insurance policies.

This can often be included in your policy. You'll need a terminal diagnosis, with a life expectancy between 6-24months (the exact timeline may vary depending on your insurer).

Long-term care benefits. You can add a permanent life insurance policy with a long-term care benefit. This allows you to access the death benefit to pay for long-term care expenses not covered by your health plan. The long-term benefits you receive reduce the death benefit. This is a significant benefit that you can have, considering that 75% of 65-year-olds today will require long-term health care.

Policy loan. You will be charged interest if you borrow against your permanent policy. However, it is usually less than other lenders' interest. There won't be any credit checks or restrictions.

Permanent life insurance provides a death benefit, similar to term insurance. Also, it allows for cash accumulation on a tax-deferred basis. This is something that a term policy doesn't offer.

It is available to you if your chronic illness makes it impossible for you to perform at most two of the six Activities of Daily Living.

Your life insurance policy may automatically include specific living benefit riders at no extra cost. To qualify, you'll need proof of the severity of your illness. You may be allowed to withdraw up to 80% of your policy proceeds if you can.