Accelerated Benefits Riders Explained - An In-Depth Look with Blue Ocean

When the time comes to start a family and be responsible for your own house, car, other properties, but most of all, being responsible for your own family (husband/wife and children), the fear of something happening to them or them being left alone is definitely a scary one. It doesn’t matter how hard you work, you will always face that fear and it will always be terrifying, that’s why we want you to avoid that type of stress and always keep in mind that there’s a way in which your family will always be protected: Life Insurance.

Now, this can be a very complex topic and it definitely pays off to have an in-depth understanding of what it is and how it works. That’s why in this article we’ll be discussing what life insurance is, what it covers, and one specific topic of interest that the majority of clients always want to know about: Accelerated Benefits Riders (ABRs).

What is life insurance?

Put simply, life insurance is a contract between an insured (you) and an insurer (the life insurance company). In this contract, you agree to pay a periodic premium in exchange for a death benefit which will be paid by the life insurance company to your beneficiary/ies in case of your death. 

There are many different life insurance policies, but all of them share the same basic premise: In exchange for a periodic premium, the life insurance company agrees to pay a death benefit to the people you selected as beneficiaries, or you can choose to have some of those benefits while you’re still alive (if you are eligible in some specific cases). If you’re interested in getting to know more, click here.

What does life insurance cover?

Life insurance covers two main things: The first one is called “Death Benefit”, and it’s the amount of money that will be paid to your beneficiary/ies in case of your death. The second one is called “Cash Value”, and it’s the accumulation of premiums you have paid overtime plus any interest or earnings.

Now, life insurance policies come with different levels of coverage, and you can choose the one that best suits your needs. The most common is:

Term life insurance: This is life insurance that covers you for a specific period of time, and after that period expires, the policy ends and you no longer have coverage.

Choosing the right life insurance policy is definitely not an easy task, but our team at Blue Ocean is here to help you make the best decision for you and your family. If you want to learn more about the different policies, don’t hesitate contacting us.

Now, let’s move on to the main topic of this article: Accelerated Benefits Riders.

What are Accelerated Benefits Riders?

Also known as “living benefits”, Accelerated Benefits Riders are a type of life insurance policy that allows the insured to collect some of the death benefits while still alive. There are different types of ABRs, but all of them share the same basic premise: They allow the insured to receive a portion of the death benefit while still alive.

ABRs are a great way to protect your family in case something happens to you, and they can be especially useful if you have a terminal illness. In most cases, the insured will have to provide proof of the illness and meet other requirements to be eligible for the benefits. Remember that you can learn more about this and more details about what you Life Insurance plan has to offer by visiting our website.

How do Accelerated Benefits Riders work?

The Accelerated Benefits Riders program is designed for people who have been diagnosed with an illness that will result in death within 24 months. Such candidates can be eligible to receive their benefits right away, considering that there’s not a specific waiting period. There’s also no annual benefit limit but in general, there is a lifetime limit regarding how many benefits you can receive across all Accelerated Benefits Riders. 

How can I manage my benefits?

When you’re chosen to be part of ABRs, you have three different options regarding what to do with your living benefits. One of the options is that you can choose to request the full acceleration of your death benefit and receive it right away. The decision of what to do with it during the time you have left will be completely in your hands. You can of course choose to receive guidance from our team to see the best ways in which you can invest your money. Another option is to receive a portion of your death benefit and leave the rest to your beneficiary/ies in the moment of your death. Finally, you can just basically change your mind and decide to leave the entire death benefit to your beneficiary/ies. In fewer words, the decision is entirely in your hands. Now that you know a little more about Accelerated Benefits Riders, it’s time to decide if they are the right option for you. At Blue Ocean Insurance, we always advise our clients to speak with a specialized agent from our team before making any decisions, contacting us is very easy! We want to make sure that you have all the information you need to make the best decision for your family. Don’t forget to book your call with us so we can begin your process right away