Best Life Insurance With Living Benefits

John Hancock Offers Life Insurance With Living Benefits

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Life insurance is a contract between you and an insurance company that pays a death benefit to named beneficiaries, or the recipients of your choosing, in exchange for premium payments. Your life insurance with living benefits policy riders include living benefits which allow you to access part of your death benefits while still alive. You may access living benefits when a qualifying life event occurs, like a terminal illness or permanent disability.

The best life insurance with living benefits comes from reputable companies that have been in business for a long time. These companies offer various types of competitively priced plans and have agents that can explain the coverage options to you.

The 6 Best Life Insurance With Living Benefits of 2021

Best Overall : John Hancock


John Hancock

John Hancock

  • AM Best Rating: A+
  • Plans: 4
  • Issue Ages: Up to 90
Why We Chose It

John Hancock earned our top ranking for a few reasons. The company’s long history, financial strength, and a below-average number of complaints are impressive. John Hancock also offers accelerated death benefits without an extra premium on all life insurance policies.

Pros and Cons
Pros
  • Online quotes for term life

  • Variety of living benefits rider options

  • Save up to 25% with the Vitality program

Cons
  • Fewer options to customize policies

  • Limited term options

  • Customer service complaints

Overview

John Hancock earned our best overall ranking because of its strong reputation and living benefits with every life insurance policy. Founded in 1862, John Hancock has a long history in the life insurance business. The Boston-based provider has an A+ financial strength rating from AM Best and had 96 complaints through the National Association of Insurance Commissioners in 2020, less than expected for a company of its size. 

John Hancock offers a range of term and permanent universal life insurance policies. You may get a quote and apply for term and final expense policies online, but you will need to call John Hancock for permanent life insurance. 

John Hancock’s term and permanent policies include accelerated death benefit riders. The company also offers riders with a waiver of premium for disability and unemployment, critical illness, and long-term care for an extra fee. You may contact John Hancock with questions by phone, Monday through Friday, from 8 a.m. to 6 p.m. EST.

You may access 10% to 25% of the policy’s face value for critical illness (maximum of $250,000), which may include a heart attack, stroke, cancer, coronary artery bypass graft, major organ failure, kidney failure, or paralysis. For accelerated death benefits, you may tap up to 50% or 100% (maximum of $1 million) of the face value.

You may use the disability waiver of premium if you’re totally disabled for at least six months. It may also be possible to access long-term care benefits of 2% or 4% in monthly installments if you can’t perform two activities of daily living (bathing, dressing, eating, continence, toileting, or transferring). 

You may save up to 25% on monthly premiums by forming healthy habits with John Hancock’s Vitality PLUS program

Read the full John Hancock Life Insurance review

Best for Term Life Insurance : AIG


AIG

 AIG

  • AM Best Rating: A
  • Plans: 5
  • Issue Ages: Up to 80
Why We Chose It

American International Group, Inc., also known as AIG, is best for term life insurance because of the company’s many customizable term policy options, including 18 terms to choose from and several add-on riders. AIG’s Quality of Life policies are also impressive, with accelerated death benefits for chronic, critical, or terminal illness.

Pros and Cons
Pros
  • Customizable term life insurance policies

  • Ability to convert term to permanent life insurance

  • Quality of Life policies for living benefits

Cons
  • Below-average for competitive pricing

Overview

AIG scores points for term life insurance policies, including its Quality of Life plans with living benefits. Initially founded in 1919 in Shanghai, China, AIG now operates in over 80 countries. The company earned an A credit rating with AM Best. It had 197 complaints through the National Association of Insurance Commissioners in 2020, less than expected for a company of its size. 

AIG offers living benefits through term, universal, and whole life insurance policies. You may apply online for term coverage but will need to speak with an agent for whole and universal life. The Select-a-Term policies include a terminal illness rider, and the Quality of Life Flex Term offers built-in accelerated death benefits for chronic, critical, or terminal illness. Both policies may guarantee a minimum benefit based on your policy agreement. You may also add a disability waiver of premium rider for an added fee. 

You can access Quality of Life benefits after a qualifying life event occurs, such as being diagnosed with a terminal illness. The disability waiver of premium is triggered after a six-month waiting period. Contact AIG’s team by phone or by email. 

AIG offers online quotes for term life. AIG ranked 15th out of 23 in J.D. Power's 2020 U.S. Life Insurance Study. Their score was below average.

Read the full AIG Life Insurance review

Best for Whole Life Insurance : New York Life


New York Life

New York Life

  • AM Best Rating: A++
  • Plans: 8
  • Issue Ages: Up to 90
Why We Chose It

New York Life earned the top spot on the list for whole life insurance coverage because of its financial strength and reputation, which are critical for whole life insurance. There are two whole life options to choose from, along with add-on riders, including the disability waiver of premium, chronic care, or living benefits options.

Pros and Cons
Pros
  • Financial strength and reputation

  • Long history of cash dividends

  • Competitive pricing

Cons
  • No online quotes

  • Living benefits may not be available in every state

  • Usually, a medical exam is required

Overview

New York Life earned points for its financial strength, reputation, and two whole life insurance policies with living benefits options. The New York-based company was founded in 1845, has an A++ financial strength rating from AM Best, and received 34 complaints from the National Association of Insurance Commissioners in 2020, a very low amount for a company of its size.  

New York Life has several policies, including term, whole life, and universal life with various riders for added protection. You can fill out a brief form on the company’s website to receive a phone call from an agent for a quote or apply for a policy.

The company’s whole life policies offer add-on living benefits options that offer access to part of your death benefit if diagnosed with a terminal illness. You may also add riders for a disability waiver of premium, chronic illness, and more. The chronic rider may also offer access to part of your policy’s death benefit. You can manage your policy online or speak with a customer service representative by phone between 9 a.m. and 7 p.m. EST, Monday through Friday.   

You can’t get a life insurance quote online and must contact an agent to get your quote. However, you won’t wait long because the company will connect you with a local agent within 48 hours of filling out the intake form. New York Life ranked sixth out of 23 insurers and scored well above the average in J.D. Power's 2020 U.S. Life Insurance Study.

Read the full New York Life Insurance review

Best for Convenience : Haven Life


Haven Life

 Haven Life

  • AM Best Rating: A++
  • Plans: 2
  • Issue Ages: Up to 64
Why We Chose It

Haven Life Insurance made our list because of its fast, online term life insurance quotes and application process. Haven Simple policy applicants may get immediate approval without a medical exam.

Pros and Cons
Pros
  • Online quotes in minutes

  • No medical exam for Haven Simple policy

Cons
  • No whole or universal life insurance available

  • No option to meet an agent in person

Overview

Haven Life made our list because it’s the best option for convenience, with quick online quotes, a fast application, and no medical exam for the Haven Simple policy. Backed by industry giant MassMutual, Haven Life has offered online term life insurance since 2015. MassMutual has been in business since 1851 and has an A++ financial strength rating from AM Best. MassMutual had just 25 complaints through the National Association of Insurance Commissioners in 2020, an incredibly low amount for a company of its size, translating to a 0.07 complaint index.

Haven Life offers two life insurance policies with living benefits, Haven Term and Haven Simple, and you can apply online or by phone. Haven Term is available nationwide. Haven Simple, which doesn’t require a medical exam, isn’t available in California, Delaware, South Dakota, North Dakota, and New York.

Both Haven Life policies offer accelerated death benefits, and Haven Term offers an additional living benefits package called Haven Life Plus. A waiver of premium rider is also available for an extra cost. Haven Life’s customer service is available by phone, chat, and email weekdays from 9 a.m. to 6 p.m. EST.

You may collect a significant portion of your death benefit through the accelerated death benefit rider if you are terminally ill with 12 to 24 months left to live. If you purchase the waiver of premium, you can stop paying premiums if you become totally disabled through illness or disability.

A 35-year-old woman can expect to pay $11.86 per month for a 20-year $250,000 term life insurance policy. The same policy may cost a 40-year-old man $17.33 per month. Your quote may differ. These are just examples from Haven Life. Monthly premiums include the accelerated death benefit rider, but the disability waiver of premium is extra. Keep in mind that without a medical exam, you will likely pay higher premiums for a Haven Simple policy vs. a Haven Term policy with a medical exam.

Read the full Haven Life Insurance review

Best for Bundled Coverage : State Farm


State Farm

 State Farm

  • AM Best Rating: A++
  • Plans: 10
  • Issue Ages: Up to 80
Why We Chose It

State Farm stands out because of its discounts for multiple types of insurance coverage. The company allows you to bundle life insurance with home or renters, health, auto, an umbrella liability policy, and many more options. State Farm is the best in our review for bundled coverage.

Pros and Cons
Pros
  • Discounts on bundled insurance

  • Online quotes for some life insurance policies

  • Meet agents in-person or by phone

Cons
  • Must speak to an agent for some policies

  • Some living benefits restrictions by state

  • Less competitive premiums

Overview

State Farm ranked high because you can save money by bundling multiple types of insurance. Founded in 1922, the company offers auto, health, home or renters, life insurance, and many more options. The company has an A++ credit rating from AM Best and received just 19 complaints with the National Association of Insurance Commissioners in 2020, an incredibly low amount for a company of its size.

State Farm offers a range of life insurance policies with living benefits, including term, permanent, and universal coverage. You may buy life insurance through an agent nationwide, either in-person or by phone, with restrictions on some policies, depending on where you live.

State Farm offers a flexible care benefit rider, which offers accelerated death benefits or long-term care protection, as well as a waiver of premium for disability. You may contact State Farm’s customer service team by phone or through the company’s mobile app.   

If you become chronically ill or need long-term care services, you may access up to 2% of your death benefit per month through the flexible care benefit rider. You may be eligible to stop paying premiums through the length of a disability through the waiver of premium for disability. You will need to speak with an agent to get a quote for the flexible care benefit rider.

Read the full State Farm Life Insurance review

Best for Seniors : Mutual of Omaha


Mutual_of_Omaha

Mutual_of_Omaha

  • AM Best Rating: A+
  • Plans: Multiple
  • Issue Ages: Up to 85
Why We Chose It

Mutual of Omaha shines with whole life insurance policies for seniors up to 85 years of age and those with term coverage may renew every year through age 95. Seniors may also tap accelerated death benefits for terminal illness or a nursing home.

Pros and Cons
Pros
  • Range of policy options for seniors

  • Online quotes for term and whole life

  • No medical exam for some policies

Cons
  • Slower application process for some policy types

  • Must speak with an agent for some policies

  • Some complex policies may be confusing

Overview

We chose Mutual of Omaha as best for seniors because it offers life insurance policies for those up to age 85 with accelerated death benefits. The Omaha, Nebraska-based company has been in business since 1909, offering a range of insurance products, and has earned an A+ financial strength rating with AM Best. The company received 66 complaints through the National Association of Insurance Commissioners in 2020, slightly above average for a company of its size.

Mutual of Omaha offers various life insurance plans, including term, whole life, children’s whole life, universal, and accidental death insurance. Depending on your policy, you may get a quote and apply online, speak to an agent by phone, or meet with an agent in person. 

You may also customize your policy with riders, which may or may not require an extra fee. Both universal and whole life policies may include living benefits. Mutual of Omaha offers automated phone support 24/7. If you're a customer you should be able to access more personalized support, including via your agent.

The universal policy allows you to access accelerated death benefits for chronic or terminal illnesses. You may also add a long-term care rider to receive monthly payments of 1%, 2%, or 4% of your death benefit. The whole life Living Promise Level Benefit Plan also offers accelerated death benefits for terminal illness or a nursing home.

However, you can’t get an online quote for universal life or whole life with a death benefit of more than $25,000. 

Read the full Mutual of Omaha Life Insurance review

Final Verdict

When choosing the best life insurance with living benefits, you have plenty of options. Ultimately, your choice may depend on your situation and the type of policy you need. Before choosing a policy, be sure to compare the fine print, including how to access living benefits and what percentage you will receive.

While not every policy comes with living benefits, many insurance providers now offer programs with riders to add on specific living benefits. Of all the companies we reviewed, John Hancock automatically includes living benefits so that all policyholders will have access to funds should they be diagnoses terminally ill or with a disability.

Compare the Best Life Insurance With Living Benefits

 Company  AM Best Rating Coverage Capacity   Issue Ages  Policies Offered
 John Hancock A+ $65 million Up to 90  Term and universal
AIG A $1 million and up Up to 80 Term, whole, and universal
New York Life A++ $5 million and up Up to 90 Term, whole, and universal
Haven Life A++ $3 million  Up to 64 Term
State Farm A++ $1 million and up Up to 80 Term, whole, and universal
Mutual of Omaha  A+ Varies Up to 85 Term, whole, and universal

Frequently Asked Questions

What Is Life Insurance With Living Benefits?

While life insurance protects your family when you pass away, living benefits may offer protection while you are still alive. You may add living benefits to your term or permanent life insurance policy through a rider, which costs extra. Typically, you may have access to your life insurance policy's living benefits once a triggering event occurs, like a terminal illness or disability. The exact cost, benefits, triggering event, and exclusions may vary by company. 

When Can I Claim Living Benefits?

Typically, you may access your life insurance policy's living benefits when a qualifying event occurs. The triggering event may depend on the living benefit rider and the details in your contract. These living benefits riders may include, but aren't limited to:

  • Long-term care rider
  • Terminal illness rider
  • Critical illness rider
  • Chronic illness rider

Some examples of qualifying events may include a health condition that:

  • Limits your lifespan to 24 or fewer months
  • Requires a significant medical intervention to survive 
  • Dramatically reduces your lifespan without a significant medical intervention
  • Requires confinement in a facility for the rest of your life

Does All Life Insurance Have Living Benefits?

As folks live longer, there are more scenarios where living benefits riders may be an attractive option. You may develop a terminal illness or permanent disability and need money to pay for your medical expenses. But unfortunately, not every life insurance policy automatically includes living benefits. While some life insurance policies may have built-in living benefits without paying extra, other life insurance policies may require an extra fee to add living benefits riders.

What Does Life Insurance With Living Benefits Cost?

The cost of your life insurance premiums varies by company, the type of policy, and term length (if applicable). Other factors that may impact the cost of premiums include your age, health, smoking status, and add-on riders like living benefits. While some policies may have built-in accelerated death benefits, this isn't the case for every company. Generally, the younger and healthier you are, the lower your premiums will be. 

$500,000 of term life insurance coverage for 20 years averages $27.46 for a 30-year-old man and $21.88 for a 30-year-old woman. These policies may or may not include living benefits riders, depending on the company. 

Methodology

To create our list of the best life insurance with living benefits, we started with 15 of the top life insurance providers. We looked for companies that offered living benefits automatically as well as by rider additions. From there, we gathered data through each company's website, phone calls, and third-party agencies to assess financial strength and customer satisfaction.   

We looked at each company's history, reputation, financial strength, and nationwide availability. Then we reviewed each provider's life insurance policies, living benefits riders, and any standout features. Finally, we also compared the process for getting quotes, customer service, pricing, and restrictions.

Article Sources

Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts. We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
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