Is there a life insurance policy that allows payment before death?



Yes, there is. Most companies that provide life insurance offer policies that will pay benefits that the insured can enjoy even while still alive. This is through a living benefit rider, usually called a ADB, or accelerated death benefit.


The ADB can be bought at the time the policy is issued, or later on during the life of the policy. With this rider, the insured can “advance” his death benefits when diagnosed with a terminal or critical illness. When this occurs, the insurance company will pay a portion of the insured’s death benefits. The insured can typically get 50 -80% of the face amount. This is either paid on an installment basis or as a lump sum.


Any one of the following should occur to benefit on the ABD:


  1. You are unable to perform your usual daily functions such as taking a bath by yourself.
  2. You are diagnosed with a serious and terminal illness that is likely to occur within two years.
  3. You are diagnosed with a medical condition such as a kidney or liver disease, a heart ailment, Alzheimer’s or if you had a heart attack or an organ transplant.
  4. You become confined permanently to a nursing home for proper care.
  5. You are free to spend your accelerated death benefit proceeds any way you like.
  6. You can use it to fund your child’s education.
  7. Go places or simply do things with friends.


Please note that even though you may receive a portion of the death benefit, you should still make sure that premiums are paid on time so that your beneficiaries can receive the rest of the death benefit upon your death.





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