ALS is a debilitating disease that robs the sufferer of all physical function by drastically weakening muscles.
The average life expectancy of ALS patients is within 2 to 5 years, and the average age of initial diagnosis is between 40 years old to 55 years old.
My life insurance focus is on Generation X which is comprised of people in their mid to late 30’s, 40’s, and early 50’s—since many ALS patients receive their initial diagnosis during this age range, ALS is an important disease that I write about.
In this article, I will discuss the Accelerated Death Benefit Rider, and how it can help ALS patients.
Before launching into the substance of this article, if you would like to donate to the ALS Association to further research to find a cure for ALS, go to this link.
If you have been diagnosed with ALS and currently do not have life insurance, your best option would be to get a guaranteed issue life insurance policy. You can read more about getting a guaranteed issue life insurance policy at this article.
In this article, I am not writing about applying for life insurance if you suffer from ALS.
In this article, I am writing about how a rider in a life insurance policy—the accelerated death benefit rider—can help ALS patients if you had a life insurance policy in force when you were diagnosed with ALS.
First things, first.
What is a Life Insurance Rider?
A life insurance rider is an add-on or endorsement to a life insurance policy that customizes the coverage for the particular policyholder.
While most riders must be purchased in addition to the standalone policy, some riders are built into the life insurance policies themselves.
Now that you understand what a life insurance rider is….
What is the Accelerated Death Benefit Rider?
According to this source, “An accelerated death benefit (ADB) is a benefit that can be attached to a life insurance policy that enables the policyholder to receive cash advances against the death benefit in the case of being diagnosed with a terminal illness.”
The accelerated death benefit rider came to the forefront during the AID’s epidemic of the 1980’s.
The two components of the accelerated death benefit rider are as follows:
- you have a terminal illness, and
- you are expected to die within two years.
So, how does the accelerated death benefit rider apply to ALS patients?
The accelerated death benefit rider is built into the life insurance contract with many life insurance companies—this rider must be purchased in addition to the standalone policy with other life insurance companies.
It just depends on the company—you need to read your life insurance policy to see if this rider is in your policy.
If you have a life insurance policy in force with the accelerated death benefit rider within it, and then you get diagnosed with ALS, you are eligible to accelerate your death benefits because
- ALS is a terminal illness, and
- you are expected to die within two years since the average life expectancy of an ALS patient is two to five years.
When invoking the rider, you must make a claim to accelerate all or just a part of the death benefit.
Here’s how the accelerated death benefit rider works:
You have a $500,000 life insurance policy with the accelerated death benefit rider added onto the policy. You get diagnosed with ALS.
You make a claim to accelerate $250,000 of your death benefits using the rider to pay for your medical expenses.. The life insurance company approves your claim.
You receive $250,000 from the life insurance company, and the remaining $250,000 life insurance policy stays in force. Your premium is adjusted based on the lower face amount of the policy.
The accelerated death benefit rider can be very helpful to ALS patients who face mounting medical fees.
I hope this has been a helpful article on how the accelerated death benefit life rider can help ALS patients.
Again, this article is intended for ALS patients who already have a life insurance policy in force at the time of diagnosis, not for ALS patients seeking life insurance after diagnosis.
If you have ALS and already have life insurance in force at the time of your diagnosis, please read the fine print in your life insurance policy to see if the accelerated death benefit rider is included in your life insurance policy.
While this rider may not be the miracle in curing your illness, it certainly can be the financial impetus in prolonging your life.
If you have been diagnosed with ALS and would like to discuss life insurance, please email me at firstname.lastname@example.org or contact me here.
Furthermore, if you would like to help find a cure for ALS, please donate to the ALS Association here.
Until next time and until next life insurance article,
Life Insurance for Generation X