What is an Accelerated Benefit Rider?
An Accelerated Benefit Rider, often included as an optional feature in life insurance policies, allows policyholders to access a portion of their death benefit while they are still alive. This feature is typically triggered when the insured is diagnosed with a terminal illness, chronic illness, or a condition that significantly reduces their life expectancy.
The funds provided through an Accelerated Benefit Rider can be used for medical expenses, long-term care, or any financial needs the insured may have. This rider provides financial flexibility and can help alleviate the burden of medical costs or lost income during a challenging time.
However, accessing these funds will reduce the final death benefit paid out to beneficiaries. It’s important to understand how much the policy allows for early access and any fees or restrictions that may apply.
In Indexed Universal Life (IUL) and Whole Life insurance, an Accelerated Benefit Rider can be a valuable addition, giving policyholders the option to maintain financial security during unexpected health events without the need to fully surrender their policy.
