Life Agent License Practice Exam

A living benefit in a life insurance policy allows policyholders to access a portion of their death benefit while they are still alive, typically in the event of a terminal illness or severe illness diagnosis. This feature provides financial support to individuals facing significant medical expenses or other financial burdens, offering them the opportunity to utilize part of the benefit they would otherwise only receive upon death.

This option emphasizes the proactive support a life insurance policy can offer beyond simply providing a death benefit to beneficiaries after the policyholder's death. By allowing access to these funds, living benefits can give individuals peace of mind in difficult times, making it a valuable component of many life insurance policies.

In contrast, options that suggest borrowing against the policy or extending coverage focus on different aspects of policy management rather than the unique feature of living benefits. Higher premiums do not correlate with the idea of living benefits, as they relate more to the cost of coverage rather than the ability to access the death benefit early.