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An alternative to this option is the "critical illness riders," which allow you to access your death insurance if you have a specific disease or ailment.

Cash value withdrawal. You can access a percentage of the cash value in your permanent life insurance policy by making a withdrawal. You will not owe taxes if the amount you withdraw exceeds or equals your premium payments. Taxes will apply if any portion you take out is from dividends, interest, or capital gains. Be aware that your policy's death benefit will be reduced if the amount is not repaid.

Living benefits protect your family from being responsible for your end-of-life care costs. Your gifts will reduce your lump-sum payments to beneficiaries. So you'll have to decide how much.

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You may have to keep the policy before receiving the living benefit.

Standard is the option to add a life benefits rider to your initial purchase of life insurance. Many policies come standard with at least one living benefit rider. This could be a terminal condition.

Permanent life insurance policies provide the option to receive accelerated death benefits, just like term insurance.

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Policy surrender. You can cancel your permanent policy and receive the cash value as a lump sum. This amount will be less than any outstanding loans or unpaid premiums.

Critical illness rider

Your life insurance policy may include living benefits at no extra cost. A terminal illness rider, for example, is usually included in term life policies automatically and without additional fees. Ask your agent about additional charges, chronic illness riders, or fees.

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Living benefits enable the insured to take money out of the policy's benefit upon death while still in good health. These funds may cover expenses related to terminal and chronic illness. There is a tradeoff: accessing living benefits may reduce your beneficiaries' death benefit.

Long-term care benefits. You can add a long-term benefit to your permanent policy to help pay for long-term healthcare expenses not covered by your health insurance. The amount you use for a long-term benefit reduces the death benefit. This is a precious benefit, especially considering that 70% of those turning 65 will require some long-term care in the next few years.

It covers critical illnesses with high medical costs and a shorter life expectancy, such as stroke, heart attack, kidney disease, or life-threatening cancer.

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Different insurers have different timelines that allow you to access cash.

Accelerated death benefits. This living benefit pays a portion of your term insurance policy if you have a terminal disease. This allows you to access the money you need to pay medical expenses and repay your debts. You can also use this money to travel or make memories with your loved ones. When it comes to these living benefits, here are four things you should keep in mind:

A 35-year-old nonsmoker could pay as little as $25-30 per Month for a $500,000 policy (20-year) with a terminal illness rider. This same person could pay significantly more if they added a long-term care rider.

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This feature is usually included in your insurance policy. To be eligible, you must have a terminal diagnosis with a life expectancy of 6-24 months (the exact timeline will vary by insurer).

Policy surrender. The cash value portion is accessed as a lump sum when you cancel your permanent insurance policy. You will receive that amount less any outstanding premiums or loans.

Chronic illness rider

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Living benefits are life insurance policy features that allow you to access some of the death benefits while your body is still alive. They are usually available as an add-on to life insurance policies.

The living benefits offered by life insurance can be used to provide additional protection.

When you purchase your first life insurance policy, opting into a living benefit rider is standard. Many policies automatically include at least one living benefit rider, such as a terminal illness.

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