Life Insurance with Living Benefits

Life Insurance you can use while alive

Life insurance with living benefits is a great way to financially protect your loved ones if a diagnosis of a critical or chronic illness happens so that bills can continue to be paid while the person and family recuperates. I’m going to tell you why I’m passionate about these types of policies and you will see why this is something you should have, even if you’re single and don’t have anyone depending on you except maybe a dog or cat.

My dad was a soccer fan and a small business owner. We like to call them “entrepreneurs” now but same thing. Here is a picture of my dad, sister and me. I’m the one on the right if you’re wondering.

All his life, my dad had been a pretty healthy guy. The usual high-blood pressure, which might be a side-effect of living in Miami and stress just from traffic. It’s very common. He worked for himself, brokering deals between general contractors, architects, and laborers with his aluminum/iron business. At the time my sister and I lived with him while going to college and also working but my dad was the bread-winner.

Around 2008, he got diagnosed with lymphoma, it’s a cancer of the immune system. At first, we were all shocked by the diagnosis, then came all the treatments. He was still able to work at the beginning but a few more months and between doctors visits, treatments and so forth it got to a point where he could no longer work.

Decisions

Image Source — https://www.lbawarenessmonth.com/statistics/experienceloss

Financially, things weren’t looking any better, with my dad not able to work and us having to take some time off work to help him go to the doctor or visit him at the hospital it was very tough. My dad, decided to move to Virginia to get better treatment and what he had in savings was used for that and maybe a few months of mortgage payments there but that was it.

We had to make tough decisions with his business, since it was a one-man operation there wasn’t much we could do to keep it afloat and without a business continuation plan in place, we didn’t know what to do, so the business eventually was lost. The apartment, we had to foreclose on because without my dad’s income we couldn’t afford it anymore.

My dad had life insurance, but not the one with living benefits. If he had one with living benefits, many of the things that happened could’ve been avoided. You see, one with living benefits provides payouts of the death benefit due to a trigger such as a diagnosis of a critical or chronic illness. Even if the person makes a full recovery, like my dad did, those finances could help when needed the most. And since it is a life insurance policy there will always be a death benefit when needed.

Living Benefit Triggers

Let’s go over how these types of policies work. You can get them in either term or permanent coverage.

Each company has their own definitions of triggers so make sure to review that before signing. This is a general overview.

Critical Illness — Usually are things such as cancer, heart attack, stroke, and many more.

Chronic Illness — Is when someone can’t perform activities of daily living such as walking, bathing, eating, dressing, transferring and more.

Sounds great but this most be expensive!

The majority of people unfortunately overestimate how much these types of policies cost. For the most part it’s about the same as a “traditional” policy. I will illustrate this with a simple quote comparison of a 35 year-old male non-smoker that qualifies for preferred plus rates. (Even for standard rates the price difference is about the same).

“Traditional plan” — $1,000,000 for 20 years : $51.60
“Living Benefits” — $1,000,000 for 20 years: $63.64

As you can see the price difference is only $12.04 a month.

These policies can be bought even if you’re older or have minor health issues.

If my dad would have known about these types of policies, I’m sure that’s what he would’ve chosen before anything happened.