Living Benefits of Life Insurance

Overview

Year after year, insurance industry surveys reveal that most consumers believe that life insurance plays an important role in a sound financial plan, ensuring the financial security of surviving family members after a loved one’s death. And yet, a large percentage of Americans do not own individual life insurance and only about half of all employees are covered by a policy at work.

The purpose of this course is to provide an overview of the living benefits that life insurance offers. It looks beyond the death benefit and examines the various ownership rights that policyowners have, which allows them to access policy benefits during an insured’s lifetime.

Learning Objectives

Upon conclusion of this course, students will be able to:

  • describe the rights that life insurance policyowners can exercise by virtue of policyownership
  • explain how permanent life insurance policies develop cash values, which are the source of most living benefits
  • explain the different nonforfeiture options available to policyowners
  • demonstrate understanding of life insurance policy loans and withdrawals
  • explain the differences between collateral and absolute policy assignments
  • describe how life insurance policies can be exchanged, tax free, for similar products under Internal Revenue Code Section 1035
  • explain why and how the tax treatment of living benefits from modified endowment policies differs from the tax treatment of living benefits from non-modified endowment policies

Designed For

Life and health insurance producers; financial planners and advisors
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