Living Benefits
What Does Living Benefits Mean?
Living benefits refer to the cash benefits available to the insured after they have paid premiums for a specified period. The cash values and endowment proceeds of a permanent life insurance policy are considered living benefits, as they are accessible to the insured during their lifetime.
Insuranceopedia Explains Living Benefits
With the introduction of variable policies, which are essentially investment packages combined with term insurance, the term “living benefits” became popular due to the uncertainty of investment market returns. To address this, living benefits riders were added to variable packages to guarantee cash after a certain period of premium payments. The cash available from a living benefits rider is designed to cushion the financial impact of old age and the need for long-term care.
