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New contactAmerican Life InsuranceChinese consumers often hear the concept of "Living Benefits" for the first time. This concept is usually simply called "Insurance that you can use while you are alive". So what exactly are Living Benefits? What is it for us? What kind of protection can it provide us? How is it different from major disease insurance in other countries or regions? What is the difference between price and premium?American Life InsuranceGuide network insurGuru©️ knowledge column invited financial and insurance consultants Heather, To bring readers an interpretation.
Introduction to the history of living benefits
As a market-oriented country in the United States, the competition among insurance companies, as well as the competition between the American life insurance industry and the asset management industry, is extremely fierce.
The iconic time point was the 80s of the last century.According to the Wall Street Journal, sales of personal life insurance products have fallen by 1980% since the 45s.
For the American life insurance industry, only relying on the feature of "compensation after death" has been unable to attract more consumers.In order to improve market competitiveness, the American life insurance industry has developedLiving Benefits, life insurance that you can use while you are aliveConcept.
From "death compensation" to "life benefits"
What is Living Benefits?
Living Benefits It is a general term concept.The American Life Insurance Guide website insurGuru©️ Life Insurance Academy defines this specifically: For a life insurance policy, as long as it meets When the insured is alive and meets the agreed conditions, he can withdraw the death compensation from the death compensation1 In this case, the policyholderStill aliveCan be used at your disposal, then we can say that this life insurance policy hasLiving Benefits.
For example: Generally speaking, after a doctor’s certificate, the insured is diagnosed with a terminal illness that will lead to death within 12 months or 24 months. If this condition is met, the insurance company will pay the insured in advance.This is a pre-mortem benefit for the insured.
At present, most mainstream American life insurance companies provide the above Living Benefits.2.
However, what do we mean by "meeting the agreed conditions"?Does cancer count?Can it be compensated for suffering from chronic diseases, can it be compensated for serious illness or injury, and can it be used as a major illness insurance?These questions are the focus of purchasing and evaluating the Living Benefits of various insurance companies.
How Living Benefits Work
In a previous article in the American Life Insurance Guide, we explained in detailRider additional termsThe significance and function of the use of the metaphorical relationship between the choice of steak and side dishes to illustrate how American life insurance products can provide a variety of functions.
Living Benefits is through matching differentRider(Additional terms) to achieve.For example, as mentioned above, the ante-mortem benefits for end-stage illnesses are realized by attaching a Rider (additional clause) to pay for end-stage illnesses to a life insurance policy.
Different insurance companies have different names for this Rider, the following are the most common names:
- Accelerated Benefit Rider (ABR)
- Living Benefits Rider (LBR)
*Note: This Rider has now become the standard configuration of mainstream life insurance companies in the United States and is widely used in whole life insurance products.At present, in the field of term life insurance, some companies also offer this Rider as an option for policyholders to choose.
The specific choice of living benefits
therefore,It is also an insurance policy with "Living Benefits". The more conditions that different insurance companies provide for the payment of the benefits during the lifetime, the more comprehensive the additional Rider, and the better the protection of the insured's interests.
Living BenefitsThe additional terms usually include the following aspects:
- Additional terms for end-of-life diseases
- Chronic diseases/long-term care additional terms
- Additional terms for major diseases
- Major injury additional clause
- Others
After understanding this, as an insured person, you can first compare your own insurance policies and what pre-mortem benefits you haveRider(additional terms), whether to meet their own needs, as mentioned above "No compensation for serious illness, no compensation for cancer"And so on; then, look at the specific additional terms and answer the next question of "how to pay when this happens, and how much to pay".
Living Benefits Price and Premium of Living Benefits
Thanks to fierce market competition, the ABR or LBR additional clauses of most whole life insurance policies are usuallyNo extra paymentof.
(>>Recommended reading:[Picture] How high is the cost of life insurance?Will the pre-mortem welfare insurance for cancer and heart disease be more expensive?）
AndChronic diseaseThe cost premiums of additional clauses and critical illnesses are often included in the insurance cost after the cost design of the actuary of the insurance company.
For Long Term Care Rider, policyholders usually need to pay an additional premium.The specific premium depends on the insurance company.
Summary
American Life InsuranceThe fierce competition in the market has prompted insurance companies to continuously update and introduce newer products, which is a very favorable situation for insurance consumers.Through this article's introduction to the concept of "Living Benefits, insurance that can be used while alive" in the American insurance market, we hope to help more consumers and obtain insurance products that can truly protect themselves and their loved ones.
Recommended reading:01. What does "Rider" mean for insurance?What is the use?
1 The compensation situation is affected by the type of insurance policy and the time value of cash. Different insurance companies pay different amounts.
2 Subject to state laws, pre-mortem benefits are not applicable or provide exactly the same payment conditions or regulations in all states.
