Which of these is considered to be a Living Benefit option in a life insurance policy?

Which of these is considered to be a Living Benefit option in a life insurance policy?

• A. Cash value accumulation
• B. Accelerated death benefit
• C. Term coverage
• D. Policy loans

Answer: (B)

A Living Benefit option in a life insurance policy is designed to provide a benefit to the policyholder while they are still alive, rather than solely offering a payout upon the insured's death. The Accelerated Death Benefit allows policyholders to access a portion of their death benefit early in the event of a terminal illness, chronic illness, or critical health condition. This feature can provide essential financial assistance for medical bills or other related expenses that arise during a difficult time. In contrast, cash value accumulation refers to the growth of savings within permanent life insurance policies, which can be accessed later but does not qualify as a Living Benefit. Policy loans allow the policyholder to borrow against the cash value of their policy, but they do not provide an immediate benefit related to specific life events. Term coverage, on the other hand, does not have any cash value or living benefits; it simply provides coverage for a designated term and pays out the death benefit only upon death during that term.

A Living Benefit option in a life insurance policy is designed to provide a benefit to the policyholder while they are still alive, rather than solely offering a payout upon the insured's death. The Accelerated Death Benefit allows policyholders to access a portion of their death benefit early in the event of a terminal illness, chronic illness, or critical health condition. This feature can provide essential financial assistance for medical bills or other related expenses that arise during a difficult time.

In contrast, cash value accumulation refers to the growth of savings within permanent life insurance policies, which can be accessed later but does not qualify as a Living Benefit. Policy loans allow the policyholder to borrow against the cash value of their policy, but they do not provide an immediate benefit related to specific life events. Term coverage, on the other hand, does not have any cash value or living benefits; it simply provides coverage for a designated term and pays out the death benefit only upon death during that term.