Life insurance with living benefits in California

The Golden State, also known as California, is a unique place to visit and live. It is best known for its long beaches and gorgeous weather year-round. However, did you also know that California has unique state laws and regulations when it comes to life insurance

Therefore, it is no surprise that trying to secure life insurance with living benefits in California could be a bit challenging. In this guide, we would outline what are living benefits, why you need them and how are they structured differently in California.

image of couple on the beach with words Living benfits in california

What we would cover

If you need additional information or would like us to take a closer look at your personal situation, simply reach out to us. You can do so by filling out the quote form on the page or give us a call.

Let’s dive in….

Living benefits 101 (what is it and why you should care)

We felt it is important to start by outlining what exactly are living benefits and what advantages they offer. To start off, we would like to point out that living benefits are Accelerated Benefit Rider (ABR) and often we would use both terms interchangeably. In fact, in most policies, they are referred to as ABR or Accelerated Benefit Riders.

Living benefits in life insurance, allow the insured to file a claim against his or her life insurance. We’d like to think of life insurance with living benefits is a new progressive life insurance movement that has all of the advantages of old life insurance plus additional protections for critical and chronic illnesses.

In other words, living benefits pay you cash when you get critical or chronic illnesses, like cancer, heart attack stroke, and etc. 

Are you able to survive financially what you physically survived Life insurance with living benefits

It helps you financially survive, what you are physically going through. To put in perspective, it gives you cash while you get back on your feet to pay the mortgage, have the lights on and put food on the table. 

Also, if you beat the disease, you can keep the money!

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Why there’s even a separate guide for California

As we mentioned California is a unique state when it comes to insurance. One main objective of the state is to ensure that its residents are not misled to believe that these benefits can substitute health insurance or long term care insurance. While, living benefits could provide financial assistance in some of these instances, at the end of the day they are tied to a life insurance policy.

Due to the regulation and the additional requirements in Californa, many insurance carriers are not able to offer living benefits to their customers or have to modify them to comply with state laws.

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Is life insurance with living benefits available in California

Yes, there are carriers that offer living benefits in California. There are additional requirements and some might be structured differently, but the residents of the Golden State could take advantage of this amazing benefit.

In addition, more carries are acknowledging the need and want to provide this additional benefit to the residents of California as well. A major carrier, just announces that starting April 2020, they are able to offer is Accelerated Benefit Riders in California.

The added bonus is that they would not even require a medical exam to secure the policy!!

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What are companies changing to comply with California regulations

Insurance is a highly regulated industry. Every change or policy verbiage has to be reviewed for compliance and approved by the state where a policy is solicited and sold. In order for a company to sell a product in any given state, it needs to ensure it complies with its laws and regulations.

In an effort to ensure that agents have all the tools and knowledge to comply with the regulations, many companies have adopted several changes:

  • Added additional state-required disclosures in their policy booklet
  • Some have created a different policy and have structured their riders differently in California (we would touch on that in a little bit)
  • Have created separate brochures and product guides specifically for the state of Califonia
  • Some carriers have added additional training materials for their agents to ensure that we know all of the requirements and are presenting the product accurately.

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Most Frequently asked questions about living benefits

We believe this is one of the most important parts of the guide. We would answer some of the most common questions our clients have had when it comes to Accelerated Death Benefit Riders. Our goal was to provide you with short and to the point answers, so you can decide if a policy with living benefits is worth it for you and your family.

Q: How do living benefits work?

A: Should you be diagnosed with a chronic, critical, or terminal illness, you may decide to file a claim under the rider. At that time you could “accelerate” or use a portion of your death benefit in advance.

Q: Would I have to repay the money I received through this option?

A: No, you don’t. This will not be considered a loan that you need to repay.

Q: Are there any restrictions on what I can use the money for?

A: No, there aren’t. You can use the money how you see fit. You can use it to pay off medical bills, living expenses, or even take your family on the last vacation. 

Q: How living benefits in California differ from any other state?

A: There are some differences amongst the carriers who were approved to offer living benefits in California. We would touch on some of the restrictions, but keep in mind that they are carrier-specific. It is best to let your advisor know if you want to this rider is important to you, to ensure that you have adequate protection.

Here are some of the differences. Keep in mind, they do not apply for all carriers.

  • Carriers may not offer the accelerated benefits rider to applicants over the age of 65
  • A chronic rider may not be available for term insurance with all carriers
  • There are restrictions on the coverage amount based on age
  • Keep in mind that living benefits in life insurance are not the same with all companies. We’ve listed a guide outlining the differences
  • There are 3 triggers that have been excluded for policies issued in CA
  1. Major multi-system trauma
  2. AIDS
  3. Severe central nervous system disease

Q: What is the biggest takeaway in the difference of living benefits in CA vs any other state?

A: The state wants to ensure that everyone understands that living benefits are not Long Term Care insurance. While it could provide financial assistance if you are not able to perform 2 out of the 6 activities of daily living, it is NOT a Long Term Care insurance.

These are just of the most common FAQs when it comes to the state-specific regulations. We’ve dedicated an entirely separate post on how to qualify and file for living benefits. We have answered 21 additional questions on this benefit

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How to secure life insurance with living benefits in California

Now you have a better understanding of what exactly are living benefits and how they could help you and your family financially. Therefore, it is time to turn our attention on how to secure a policy with living benefits.

We’ve listed the 4 step process:

Reach out to us

You can do so by filling out the quote form on the page or simply give us a call. Please make sure you let us know that living benefits are important to you, so we can match you with the carriers that offer them. We believe in choices, so we can present you with options that do not include the riders, so you can make the decision for yourself.


After we’ve gone over your needs, health, lifestyle, and budget, the next step is to submit an application. Based on the carrier, the process of applying could take approximately 20-30 minutes and it could be completed entirely over the phone. Our agents would go over the application with you and send it for your review and e-signatures.

Complete a medical exam, if one is required

Some companies could require a medical exam, while others won’t. If you do need to complete an exam, we would take care of the scheduling and facilitating the process. Typically, life insurance carriers have a list of approved lab facilities. We would reach out to them and schedule a nurse to come to your home, place of work, or you can meet them at their facility. The appointment takes approximately 15-20 minutes to complete.

Keep in mind that there are carriers who offer living benefits in California and DO NOT require a medical exam.

Place in force

This is the last and final step in the process. After we have the carrier approval, we move forward with placing in force. Companies would allow you to electronically complete any required signatures. After the initial payment has been processed, they will mail or email you the policy.

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In conclusion,

We are excited to let you know that now there are more options the residents of California can choose from when it comes to life insurance with living benefits. It is our belief that having this feature in your life insurance policy could be a great addition and provide you with financial assistance when you and your family need it the most.

We hope you find this helpful. If you want to learn more or secure a policy with living benefits, simply reach out to us.

Thank you!