What is the term for the provision in some group life insurance plans that allows for payment of part of the death benefit in the event of terminal illness?

The provision referred to in the context of group life insurance plans is known as accelerated death benefits. This term describes a feature that allows policyholders to receive a portion of the death benefit while still living if they are diagnosed with a terminal illness. This can provide financial support for medical care or other expenses that may arise during the final stages of life, alleviating some of the financial burden on the individual and their family.

Accelerated death benefits are designed to offer a safety net, ensuring that individuals facing serious health challenges have access to funds at a crucial time. Typically, this benefit is structured such that the amount withdrawn reduces the total death benefit available to beneficiaries upon the insured’s passing.

Other options like waiver of premiums, maturity value benefits, and continuation-of-protection serve different purposes in insurance policies. Waiver of premiums allows policyholders to suspend premium payments under certain conditions, such as disability. Maturity value benefits refer to payouts that occur when a life insurance policy reaches its maturity date, which is not directly related to terminal illnesses. Continuation-of-protection deals with maintaining insurance coverage, particularly during life changes, but does not pertain to accessing benefits.

By understanding accelerated death benefits, individuals can better navigate the options and features available within their life