What is an "accelerated death benefit"?

An accelerated death benefit is a provision typically found in life insurance policies that allows terminally ill policyholders to access a portion of their death benefit before they pass away. This feature is particularly designed for individuals diagnosed with a terminal illness, providing them with the means to alleviate financial burdens associated with medical expenses or other needs they may have in their final days. By receiving this benefit early, policyholders can use the funds in a manner that supports their quality of life during a challenging time.

This benefit is a valuable tool for policyholders as it allows them to make beneficial use of their insurance coverage while they are still alive, rather than waiting for the death benefit to be paid out to beneficiaries posthumously.