Best Life Insurance Companies for Living Benefits in 2022

Based on MoneyGeek’s analysis, Mutual of Omaha, New York Life and Transamerica are some of the best life insurance companies with living benefits. Living benefits, otherwise known as accelerated death benefits, entitle you to a percentage of your base policy's payout if you are diagnosed with a terminal illness. It is particularly suitable for people whose family has a history of chronic or critical illnesses.

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Last Updated: 11/12/2022
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According to our analysis, the best companies for life insurance with living benefits are Mutual of Omaha, New York Life and Transamerica.

Mutual of Omaha ranks highest as its living benefit offers 80%, or no more than $1 million, of the policy’s death benefit, whichever is lesser. This is higher than most providers offer, but the amount you receive will depend on your situation.

Review our analysis to learn more about these companies to find the best life insurance with living benefits for your needs.

iconribbonBest LifeInsurance CompaniesLiving Benefits2022

Best Life Insurance Companies for Living Benefits in 2022

An accelerated death benefit, also known as living benefits, pays a percentage of your base insurance policy's benefits if you are diagnosed with a terminal illness. It is typically used if you have less than a year to live and is meant to pay for treatments or other medical expenses.

However, this also means that insurance companies may deduct the payouts for your beneficiaries once you pass away. A living benefit can automatically be included in your policy or added optionally, depending on the type of policy and your provider.

Key Takeaways

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Living benefits allow you to get a percentage of your policy’s base payout if you are diagnosed with a terminal illness.

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A living benefit can be part of your policy or optional, but it’s good for those whose family has a history of chronic or critical illnesses.

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Terminal illnesses like advanced cancer, or chronic illnesses such as diabetes, are examples of illnesses that could trigger a living benefits rider.

Best Overall: Mutual of Omaha

Mutual of Omaha

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Offers quotes online

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Has a lot of riders and benefits

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Has a generous living benefit rider

cons

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Not the most affordable

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Living benefit rider availability may vary by state

COMPANY HIGHLIGHTS

Life insurance policies from Mutual of Omaha include a variety of riders and benefits — with living benefits being one of them. Mutual of Omaha offers up to 80% of the policy’s death benefit or a maximum of $1 million, whichever is lesser.

Aside from offering a generous living benefit, the company performs well in customer service and above-average product offerings. However, there may be more affordable providers for some.

Product offering

Mutual of Omaha offers term, whole, universal and children’s whole life insurance policies. The company offers policies for all age groups from 14 days old to age 85. We have ranked Mutual of Omaha as one of the best providers to offer coverage without a medical exam.

Aside from being accessible to almost anyone, the company also has a range of riders under term life, whole life and universal life policies. These riders include the living benefit rider, guaranteed insurability rider, accidental death benefit, disability continuation of planned premium and more. Keep in mind that the availability of these riders varies based on the plan types.

Support features

Mutual of Omaha offers a range of ways to easily get a policy and make a claim. There are online quote tools for all types of policies and coverage need calculators on its site. It is also possible to file a claim on its site. If you want to talk to a representative, you can contact a sales consultant on the phone.

Policy Types Offered

  • Term life
  • Whole life
  • Universal life

Runner-Up: New York Life

New York Life

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Offers a wide array of life insurance products

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Offers conversion from term to permanent life policies

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Has great customer service

cons

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Cannot get a quote online

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Not the most affordable option

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Living benefits rider availability may vary by state

COMPANY HIGHLIGHTS

New York Life is one of the largest insurers in the country, ranking second among the best life insurance providers with living benefits. While its availability varies by state, New York Life’s living benefits rider can be applied to whole life and other permanent life insurance policies. This gives policyholders access to part of their death benefit in the event of a terminal illness with a life expectancy of fewer than 12 months.

Product offering

New York Life scores highly in customer service and offers a wide array of life insurance products and riders from term life, whole life, universal life and variable life insurance.

Each type of life insurance also comes with a selection of riders. For instance, its term life policies come with accidental death benefits, children’s insurance, living benefits and more. Its whole life insurance has the same options as a term life policy but with other exclusive riders such as chronic care, insurance exchange, payer protection benefit and more.

Support features

Interested applicants can fill out a form online and be contacted by a representative within 48 hours. There is also a rate calculator on NYLexpress.com, which shows information on simplified life term policies.

You can reach New York Life via phone or their website if you need support.

Policy Types Offered

  • Term life
  • Whole life
  • Universal life
  • Variable universal life

Most Affordable: Transamerica

Transamerica

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Offers affordable policies

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Has a wide range of products

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Lets you easily get a quote and apply online

cons

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Does not have a mobile app for policyholders

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Whole life policy is essentially a final expense policy

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Filing a claim online can be difficult

COMPANY HIGHLIGHTS

Transamerica is another insurance giant offering a wide range of life insurance products. Ranking third on MoneyGeek’s list of the best life insurance companies with living benefits thanks to its affordability, Transamerica is a good choice for those who want living benefits at a lower cost.

Transamerica’s living benefits rider is known as the Critical Illness Accelerated Death Benefit rider, and is optional in their whole life insurance policies. This rider qualifies you to get a portion of your death benefit if you get diagnosed with a chronic or critical illness.

Product offering

Transamerica’s offers many life insurance products. On top of the traditional term, whole life, index universal and final life insurance policies, it also offers life insurance for foreign nationals and a standalone accidental death policy.

Their riders are also substantial, including a disability waiver of premium rider, income protection option, term insurance rider, children’s benefit rider and more. Transamerica’s policies may be an ideal option for those who want a living benefit rider at an affordable cost.

The company also offers nonmedical underwriting for certain policies — which can benefit seniors most — but coverage amounts may be lower.

Support features

Transamerica offers quotes online and can be contacted via phone and its web portal. If you want to speak to a representative or agent in person, the site also has an agent locator to help you find one in your area.

Policy Types Offered

  • Term life
  • Index universal life
  • Final expense life
  • Whole life
  • Life insurance for foreign nationals

What Are Living Benefits in Life Insurance?

In life insurance, living benefits are a percentage of your policy’s base payout that you can withdraw if you are diagnosed with a terminal illness. The payout is then used to make your life as comfortable as possible, paying for treatments or care.

Here are some qualifiers for living benefits:

  • You contract a terminal illness and are deemed likely to die within six months to two years
  • You are in hospice care due to an illness
  • You need an organ transplant
  • You have been diagnosed with an illness that is expected to reduce your lifespan

Some examples of terminal and chronic illnesses that could trigger a living benefit include:

  • Advanced cancer
  • Diabetes
  • Lung disease
  • Neurological diseases like Parkinson’s
  • Dementia

Should You Get a Life Insurance Policy With Living Benefits?

Having a life insurance policy with living benefits may offer peace of mind, but if it’s not automatically part of your default inclusions, it’s important 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.

Review some situations where a living benefit add-on is a good idea below.

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    Your family has a history of chronic illness

    Your family’s medical history can help determine what types of illnesses or problems you may encounter throughout your life. If your family has had a history of chronic or terminal illnesses, it may be a good idea to get a living benefit.

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    You are diagnosed with a chronic illness

    If you have been diagnosed with a chronic illness, you may want to get a life insurance policy with a living benefit. This ensures you have access to extra funds should you need them for medical expenses.

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    You are diagnosed with an illness that reduces your lifespan

    If you are diagnosed with an illness that reduces your lifespan, getting a living benefit can help you prepare for anything unexpected.

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    You may need long-term care

    Long-term care can be costly. If you expect to need care in the future, getting a living benefit can help you pay for the costs.

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MONEYGEEK EXPERT TIP

If your circumstances are not similar to the ones mentioned above, you can forgo a living benefits rider. Instead, find one of the best life insurance policies for your situation by looking for providers that balance cost and customer service. This way, you can rest easy knowing that you and your beneficiaries are taken care of.

What’s the Difference Between Living Benefits & Accelerated Death Benefits?

Both living benefits and accelerated death benefits pertain to the same thing — an add-on to your policy that allows you to “accelerate” your death benefit and use it while you’re living. Aside from these two terms, you can also refer to it as a terminal illness rider.

Insurance Rates

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Frequently Asked Questions

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

Methodology

To come up with our ranking scores, we incorporated data from JD Power, AM Best, NAIC, and our own MoneyGeek affordability score, which we created by manually gathering thousands of quotes across major providers.

We used our qualitative research data to determine the best life insurance companies for living benefits based on each company’s product offering and support features.

About the Author


expert-profile

Mark Fitzpatrick is a senior content manager with MoneyGeek specializing in insurance. Mark has years of experience analyzing the insurance market and creating original research and content. He graduated from Boston College with a Bachelor of Arts and Johns Hopkins University with a Master of Arts.