Which statement is true regarding acceleration benefits?

Which statement is true regarding acceleration benefits?

• A. They must provide for a lump sum benefit option.
• B. They must be paid only as monthly installments.
• C. They are excluded from being paid alongside a base policy.
• D. They require a separate premium for access.

Answer: (A)

Acceleration benefits are living benefits that let the insured access part of the policy’s death benefit before death, typically when diagnosed with a qualifying illness. A lump-sum option is a common and practical way these benefits are paid, providing immediate liquidity for medical costs or care needs. That’s why the statement describing a lump-sum option as part of acceleration benefits is the best fit. While some plans may also offer installment payments, the availability of a lump-sum payout is a standard feature and doesn’t require a separate premium for access in most cases. (It’s also worth noting that taking an accelerated benefit usually reduces the death benefit that would be paid later.)

Acceleration benefits are living benefits that let the insured access part of the policy’s death benefit before death, typically when diagnosed with a qualifying illness. A lump-sum option is a common and practical way these benefits are paid, providing immediate liquidity for medical costs or care needs. That’s why the statement describing a lump-sum option as part of acceleration benefits is the best fit. While some plans may also offer installment payments, the availability of a lump-sum payout is a standard feature and doesn’t require a separate premium for access in most cases. (It’s also worth noting that taking an accelerated benefit usually reduces the death benefit that would be paid later.)