There are a number of benefits you can add or utilize with many of our life insurance policies.
Convert Term Life Insurance to Permanent Life Insurance
Lock In the Ability to Buy More Insurance Based on Your Health Today
Adding the Additional Purchase Benefit (APB) to a policy enables you to lock in the right to buy more insurance in the future based on your health today.
It means that at selected intervals up until you’re 40, you can buy more insurance – even if you’re diagnosed with an illness or condition that would make it difficult or impossible to get additional life insurance elsewhere. This means you’re able to buy more insurance at the specified intervals at the same underwriting class as when you initially got your policy (before your health adversely changed).
You can also add the APB to a life insurance policy you are buying for a child. This way, you are not only insuring the child’s life, but also protecting the child’s ability to purchase additional insurance later in life, no matter what happens to that child’s health.
Keep Pace with Inflation
If things cost more, your death benefit will go up.
What seems like plenty of money today may not be in the future. At the beginning of 1980, the median sales price of a new home in the U.S. was $62,900. Ten years later, at the start of 1990, the median price of a new home was $125,000.1 At the start of 1996, the price of a gallon of milk was $2.54. By 2013, it was $3.52.2 On policies where the Indexed Protection Benefit is available, adding the IPB increases your death benefit based on the Consumer Price Index (a common measure of inflation), with an annual cap.
Protect Against Disability
By adding the Waiver Benefit, if you become totally disabled, after a period of time your premiums are paid and your policy stays in effect.
For universal life policies, two forms of waiver are generally available. One form waives a specified premium; the other waives the ongoing monthly charges.
With term life insurance, a disabled policyowner may be able to convert the term policy to a permanent plan and have those relatively higher permanent policy premiums waived during his or her disability.
Early Payment Benefit
The benefit provides the policyowner with the ability to access a portion of the death benefit upon the diagnosis of a terminal illness.
Options Available if Premium Payments Are Missed
Options to continue permanent life insurance coverage if you are ever unable to pay your policy premiums include:
- Automatic Premium Loan (APL): If a scheduled premium payment is missed, money is automatically borrowed against the cash value of a permanent life insurance policy to pay the overdue premium, and interest is charged until the loan is repaid.3
- Extended Term Insurance: Keeps the full death benefit in force for a limited period of time.
- Paid-Up Insurance: This option keeps some level of protection in force by using the policy’s entire cash value to purchase paid-up permanent life insurance. The face value of the paid-up insurance will, in most cases, be less than the face amount of the original policy, but no further premiums are required. The paid-up policy remains in force until the insured dies.
- Cash Surrender: You may elect to receive the policy’s cash value by surrendering the policy. Any outstanding loan balance and accrued loan interest will be deducted from the cash value.