SEPTEMBER IS LIFE INSURANCE AWARENESS MONTH
Especially after the recent pandemic, more people are acknowledging the uncertainty of life and the need for protecting their family or business when they are no longer around.
BUT, how does one protect themselves and their loved ones in the midst of a health crisis?
People often assume that their health insurance will cover most eventualities. This is not necessarily the case. In general, health insurance only provides for treatment of health conditions and there are major gaps (depending on one’s plan) in what treatments/conditions they will cover. It is important to note that even a good health insurance plan will not cover periphery services or extra living expense due to a health issue.
Disability insurance, long term care insurance, as well as a wide variety of supplemental insurance programs attempt to close that gap. However, these programs have many limitations such as, scope of care provided, age restrictions, as well as significant limitations on what counts as a triggering event.
HOWEVER, there is a better option! No longer is life insurance just to help others when you die. Now, there are riders on some life insurance policies that are called living (or accelerated) benefits.
These benefits allow early access to a portion of the death benefit for certain major or long-term health crises. Depending on the trigger it is possible to access anywhere from 50% – 80% of your death benefit. If you have a million-dollar policy, on the low end of the spectrum you would receive around $500,000 as a tax-free lump sum.
This opens a world of possibilities so you can fully live the life you have. With living benefits, you can pay for good care, pay bills, or go take a vacation.
What if you don’t use the benefit?
Often, the living benefit riders are attached to permanent (cash-value policies) so, if you live a long, healthy life you still receive a benefit, or you can always use the normal death benefit. So, whether you live long and healthy, or die young, or some other iteration, you can celebrate life through knowing every eventuality is covered.
The best way to get the right program in place is to talk with your insurance professional. If you are a Colorado resident in need of an insurance professional, feel free to reach out to my office via the contact form.