Accelerated Death Rider | Life Insurance Explained

Meet Cameron. He’s been paying premiums for a life insurance policy for the past few years. Now he is receiving portions of the death benefit even though he is still alive. How? It’s all because of the accelerated death benefit rider. Watch this video till the end to know more about the accelerated death benefit in life insurance.
Let’s start with the main question. What are accelerated death benefits?
Firstly, it is a rider that is applied to a life insurance policy. Combined with a terminal illness diagnosis, an accelerated death benefit will enable the policyholder to receive cash advances against his or her death benefit. Many people who choose an accelerated death benefit are in their last year of life and use the proceeds for treatment and other expenses.
Accelerated death benefits are also called terminal illness benefits or living benefits.
While I have your attention, please hit that subscribe button and bell button to join our notification squad.
Now, how does it work?
By having accelerated death benefit policies, the policyholder can provide for their family as comfortably as possible after they die. Benefits of this type were initially sought to relieve financial worries of people diagnosed with AIDS in the late nineteen eighties.
The death benefit may be accelerated even if it isn't stated in the contract. An accelerated death benefit is payable if the policyholder must die within two years after contracting a terminal illness. If you are suffering from a terminal illness or need an organ transplant, you are eligible for foster care as well. Assistance with everyday activities such as bathing may be possible through enhanced death benefits.
An insurance company's and policy's accelerated death benefits cost could be different. The cost of this rider may already be included in the policy premium. If not, you must pay a fee or a percentage of the death benefit.
The amount accelerated can be a specific portion of the death benefit. For example, Cameron may request half the death benefit to be accelerated. He would then continue paying reduced premiums based on the reduced amount of death benefit. The other half of the death benefit can be claimed by the beneficiaries after the policyholder passes away.
Payments from accelerated death are usually tax-exempt. Benefits like this don't replace long-term care insurance. Long-term care insurance only covers some expenses. That’s why the accelerated death benefit would complement long-term insurance. Nevertheless, it cannot replace long-term care insurance.
If you liked this video, make sure you demolish that Subscribe button and join our notification squad by hitting that bell button.

----- VIDEO CONTENT -----
00:00 – INTRODUCTION
00:20 – WHAT IS AN ACCELERATED DEATH RIDER
01:00 - HOW DOES IT WORK?
01:30 – PREMIUMS
02:00 – LONG-TERM CARE INSURANCE