Best Life Insurance Companies for Living Benefits in January 2024

Living benefits in life insurance allow policyholders to access part of their death benefit early in the event of a qualifying medical condition, offering a financial safety net when it's most needed. Individual policy details and the nature of the policyholder's health condition typically determine the specific amount accessible through living benefits. Keep in mind that living benefits may lead to higher premium rates depending on the insurance provider and policy features.

MoneyGeek found that Nationwide excels as the premier choice among life insurance companies offering these benefits, garnering an overall MoneyGeek score of 97. Mutual of Omaha comes in second place, while Allstate provides a competitive option for individuals who value affordability.

Nationwide, with a MoneyGeek score of 97, stands out as MoneyGeek's best life insurance company for policies with living benefits. On average, a Nationwide 10-year term policy with a $250,000 coverage amount costs $16 per month.

Note that adding optional riders, such as living benefits, may increase premium rates.

Mutual of Omaha comes in second in our ranking of the best life insurance companies for living benefits, earning a MoneyGeek score of 95. The company offers a $250,000 10-year term policy at an average of $17 monthly, with the option to add living benefits like chronic, critical and terminal illness riders.

Allstate is MoneyGeek’s best cheap life insurance company for living benefits, receiving the highest affordability rating. It has a MoneyGeek score of 97, the highest in this category. An Allstate 10-year term policy with a $250,000 coverage costs an average of $12 monthly.

Living benefits in life insurance policies, sometimes referred to as accelerated death benefits, refer to the provisions that allow the policyholder to receive a portion of the death benefit while still alive under certain conditions. These benefits are designed to provide financial relief in situations where the policyholder is diagnosed with a terminal illness, requires long-term care or is unable to perform basic living activities due to a chronic illness.

The specifics of living benefits can vary widely among policies and insurers. Typically, a medical diagnosis that significantly shortens life expectancy or necessitates substantial and ongoing medical care will trigger these benefits. You can use the funds from living benefits for a variety of purposes, such as covering medical expenses, paying for in-home care, or even settling everyday bills, allowing the policyholder to maintain their quality of life.

Accessing living benefits reduces the death benefit payout to beneficiaries upon the policyholder's death. Consider this aspect when evaluating the long-term financial impact on your dependents.

A life insurance policy with living benefits may offer a financial safety net, but if it’s not already part of your default inclusions, it’s helpful to evaluate your situation to determine whether you should add it. After all, you may not want to pay extra for a benefit you aren’t likely to use.

We review some situations below to illustrate when a living benefit add-on is a good idea.

While living benefits in a life insurance policy can offer valuable financial protection in times of health crises, they may not be necessary or beneficial for everyone. Here are some scenarios where opting out of living benefits might make sense.

Remember to consider your overall financial strategy, health status and coverage needs when deciding whether to include living benefits in your life insurance policy.

Review some of the most frequently asked questions below about the best life insurance with living benefits.