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Life Insurance and the Living Needs Benefit Rider

Americans are living longer in recent years and it is possible at some point you may need help caring for yourself. Health insurance may cover some or all of your medical procedures and hospitalizations, but what about non-medical, personal care? With people living longer, there may come a time when you need help with daily living tasks. Life insurance with a Living Needs Benefit Rider can help with these expenses.

So what is a rider in insurance? Life insurance riders are typically add-ons to the policy that allow you to choose additional features to customize coverage to meet your specific needs. Some life insurance companies offer policies with “living benefits riders” at no additional premium. They can be added to single-life permanent and level-term insurance policies.

Many believe that Medicare pays for home care or nursing home care, but this is a misconception. Medicare may pay for a limited time after an illness or injury, however longer term services will typically be your responsibility.

Here are some examples of Living Need Benefit Riders.

Long-term care riders: These riders step in to cover the costs of at-home or facility-based care if you become unable to perform activities of daily living, such as bathing, dressing, meal preparation or medication reminders. Some long-term care riders offer you payment of a sum of money on a regular schedule,while others reimburse you for applicable expenses.

Terminal illness option: This option provides for an advance of funds from your life insurance policy if you become terminally ill. You can use the money for medical care not covered by insurance, such as alternative treatments, live-in care, or whatever else you may need.

Nursing home option: This option provides for an advance of funds from your life insurance policy if you have been confined to an eligible nursing home for six consecutive months and you are expected to remain there.

Waiver of premium riders: These riders activate when you become too ill or injured to work. Generally, your insurer will need proof of a significant level of disability. While the disability persists, this rider puts a pause on what you owe in premiums.

Critical illness riders: These riders function a lot like the terminal illness option, except that the qualifying illness doesn’t need to be terminal. This allows you to access the money in your death benefit to pay for medical care or other expenses after diagnosis of a serious illness.

When it comes to life insurance and living need benefits riders, two facts stand out. First, an estimated 70% of people will need assistance with care, and two, the care will be costly. A Living Needs Benefit Rider may be the right solution for you or your loved ones.


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