Your life insurance policy riders, or add-on benefits, may include living benefits, which may 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.
When choosing life insurance with living benefits, there are many options to choose from, so it's critical to do your homework. To make the process easier, we have compared 15 of the best life insurance with living benefits options. These are the best picks based on your family's needs and goals.
The 6 Best Life Insurance With Living Benefits of 2021
Best Overall: John Hancock
John Hancock earned our top ranking for a few reasons. The company’s long history, financial strength, and below-average number of complaints are impressive. John Hancock also offers accelerated death benefits without an extra premium on all life insurance policies.
Online quotes for term and final expense policies
Variety of living benefits rider options
Save up to 15% with the Vitality program
Fewer options to customize policies
Limited term options for no medical exams
Customer complaints about the Vitality program
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+ credit rating from AM Best and had 10 complaints through the National Association of Insurance Commissioners in 2019.
John Hancock offers a range of term, permanent, and final expense with guaranteed acceptance 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, but those benefits aren’t available in Massachusetts and Oregon. 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, live chat, or email 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% (maximum of $1 million) of the face value, but only if you’re terminally ill with a lifespan of 12 to 24 months. 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 1%, 2%, or 4% in monthly installments if you can’t perform two activities of daily living (bathing, dressing, eating, continence, toileting, or transferring).
A 35-year-old woman may spend about $25 per month for a 20-year $250,000 term life insurance policy, while a 50-year-old woman may have to pay about $52 per month for a 15-year $250,000 term life insurance policy. You may save up to 15% on monthly premiums by forming healthy habits with John Hancock’s Vitality PLUS program.
Read the full review: John Hancock Life Insurance.
Best for Term Life Insurance: AIG
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.
Customizable term life insurance policies
Ability to convert term to permanent life insurance
Quality of Life policies for living benefits
No online quotes
Below-average for competitive pricing
Above-average for the number of customer complaints
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. Although the company earned an A credit rating with AM Best, it had 289 complaints through the National Association of Insurance Commissioners in 2019.
AIG offers living benefits through term, universal, and whole life insurance policies. You may apply nationwide but will need to speak with an agent. 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 until age 65. Contact AIG’s team online, by phone, or by mail.
AIG doesn’t offer online quotes, so you have to contact an agent. However, you may not receive competitive premiums as the company’s pricing scored low on J.D. Power’s 2019 U.S. Life Insurance Study.
Read the full review: AIG Life Insurance.
Best for Whole Life Insurance: New York Life
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 three whole life options to choose from, along with add-on riders, including the disability waiver of premium, chronic care, or living benefits options.
Financial strength and reputation
Long history of cash dividends
No online quotes
Living benefits may not be available in every state
All policies require a medical exam
New York Life earned points for its financial strength, reputation, and three whole life insurance policies with living benefits options. The New York-based company was founded in 1845, has an A++ credit rating from AM Best, and received 71 complaints from the National Association of Insurance Commissioners in 2019.
New York Life has several policies, including term, whole life, universal life, and variable 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 to apply for a policy.
The company’s whole life policies may offer three add-on living benefits options, depending on where you live. You may add riders for a disability waiver of premium, chronic illness, or terminal illness. The chronic and terminal illness riders may 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.
While you can’t get a life insurance quote online, New York Life’s pricing ranked high with a “Better than Most” score from J.D. Power’s 2019 U.S. Life Insurance Study. And you won’t wait long because the company will connect you with a local agent within 48 hours.
Read the full review: New York Life Insurance.
Best for Convenience: Haven Life
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.
Online quotes in minutes
No medical exam for Haven Simple policy
No whole or universal life insurance available
No option to meet an agent in person
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 2013. MassMutual has been in business since 1851 and has an A++ credit rating from AM Best. MassMutual had 24 complaints through the National Association of Insurance Commissioners in 2019.
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, and North Dakota. Haven Life policies offer living benefits, including accelerated death benefits and disability waiver of premium. 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. It may be possible to stop paying premiums if you become totally disabled through illness or disability.
A 35-year-old woman can expect to pay about $19 per month for a 20-year $250,000 term life insurance policy. The same policy may cost a 50-year-old woman about $49 per month. Monthly premiums include the accelerated death benefit rider, but you may have to pay extra for the disability waiver of premium, depending on the underwriter. Keep in mind that without a medical exam, you will likely pay higher premiums for a Haven Simple policy.
Best for Bundled Coverage: State Farm
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, and an umbrella liability policy and is the best in our review for bundled coverage.
Discounts on bundled insurance
Online quotes for some life insurance policies
Meet agents in-person or by phone
Must speak to an agent for some policies
Some living benefits restrictions by state
Less competitive premiums
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, and life insurance. The company has an A++ credit rating from AM Best and received 41 complaints with the National Association of Insurance Commissioners in 2019.
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. A 35-year-old woman may spend about $19 per month for a 20-year $250,000 term policy, with an extra $5 per month for the waiver of premium for disability. However, a 50-year-old woman may pay about $44 per month and an additional $21 for the same policy and rider. You will need to speak with an agent to get a quote for the flexible care benefit rider.
Read the full review: State Farm Life Insurance.
Best for Seniors: Mutual of Omaha
Mutual of Omaha shines with whole life and universal life insurance policies for seniors up to 85 years of age, and those with term coverage may renew every year through age 94. Seniors may also tap accelerated death benefits for terminal illness or a nursing home.
Range of policy options for seniors
Online quotes for term and whole life
No medical exam for some policies
Slower application process
Must speak with an agent for some policies
Some complex policies may be confusing
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+ credit rating with AM Best. The company received 41 complaints through the National Association of Insurance Commissioners in 2019.
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 support by phone or by email. You may reach the team Monday through Thursday from 7 a.m. to 5:30 p.m. CST and Friday from 7 a.m. to 5 p.m. CST.
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.
A 35-year-old woman may spend about $15 per month for a 20-year $250,000 term policy, and a 50-year-old woman may pay about $40 per month for the same plan. You can’t get an online quote for universal life or whole life with a death benefit of more than $25,000, however.
Read the full review: Mutual of Omaha Life Insurance.
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.
Best Life Insurance With Living Benefits
|Company||Why We Picked It||Standout Feature|
|John Hancock||Best Overall||Living benefits included for all life insurance policies|
|AIG||Best for Term Life Insurance||Customizable term policies including Quality of Life with living benefits|
|New York Life||Best for Whole Life Insurance||Three whole life policies with living benefit add-ons|
|Haven Life||Best for Convenience||Fast online quotes and application process|
|State Farm||Best for Bundled Coverage||Discounts for bundled insurance coverage|
|Mutual of Omaha||Best for Seniors||Range of policy options for seniors|
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.
Based on our research, a 35-year-old woman may pay anywhere from about $15 to $25 per month for a $250,000 20-year term life insurance policy. In comparison, a 50-year-old woman may spend $40 to $52 per month for the same term and death benefit. These policies may or may not include living benefits riders, depending on the company.
How We Chose the Best Life Insurance With Living Benefits
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.
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