Acceleration Life Insurance

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DEFINITION of 'Acceleration Life Insurance'

A type of policy that pays a portion (typically 25\% or 50\%) of the death benefits (the face amount of the policy, less any outstanding loans or fees) in case of a specified illness or medical emergency.

BREAKING DOWN 'Acceleration Life Insurance'

The accelerated death benefit provides funds necessary to pay for medical costs, to extend the life of the insured. Insurance companies pay the specified percentage of the death benefit in a lump sum.

Upon death, the remainder of the insured's death benefit is paid to the beneficiary, just as under a traditional life insurance policy.

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RELATED FAQS
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    Understand the difference between the various components of a life insurance policy including the death benefit and a policy's ... Read Answer >>
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    Accidental life insurance is an inexpensive way of obtaining life insurance coverage for yourself or someone else in your ... Read Answer >>
  3. How are life insurance proceeds taxed?

  4. What is the difference between term and universal life insurance?

    Term life insurance is the most basic of insurance policies. It is nothing more than an insurance policy that provides protection ... Read Answer >>
  5. What is term insurance?

    Term insurance is a type of life insurance policy that provides coverage for a certain period of time, or a specified "term" ... Read Answer >>
  6. How can I borrow money from my life insurance policy?

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