Mutual of Omaha Living Benefits Explained
Mutual of Omaha is a highly respected insurance company with over a century of experience in providing financial protection to individuals and families. While they’re best known for their Medicare supplement plans and whole life insurance, Mutual of Omaha also offers term and universal life policies that include living benefits—a feature that adds real-time value to a traditionally future-focused product.
If you're considering a life insurance policy from Mutual of Omaha, understanding how living benefits work and what they offer can help you make a more informed and strategic decision.
What Are Living Benefits?
Living benefits, also known as accelerated benefit riders, allow policyholders to access a portion of their life insurance death benefit while still alive. This typically happens when the insured is diagnosed with a qualifying illness or medical condition. The purpose of these benefits is to provide financial support during some of life’s most difficult times, such as facing a terminal illness or coping with long-term care needs.
Living Benefits Offered by Mutual of Omaha
Mutual of Omaha includes living benefits in many of its life insurance products. These benefits generally fall into three categories:
1. Terminal Illness Rider
This rider allows policyholders to accelerate a portion of their death benefit if they are diagnosed with a terminal illness and have a life expectancy of 12 to 24 months or less (depending on the state). The funds can be used for any purpose, from medical treatments to paying off debt or spending time with family.
2. Chronic Illness Rider
If the insured is unable to perform two or more activities of daily living (ADLs), such as bathing, dressing, or eating, they may be eligible to receive part of their benefit early. This is also applicable in cases of cognitive impairment. These funds can help cover the cost of long-term care, home modifications, or daily living expenses.
3. Critical Illness Rider (in select products)
Some policies may also include a critical illness rider that covers serious medical conditions such as cancer, heart attack, stroke, kidney failure, or organ transplant. The availability and definition of these conditions vary by product and state.
Policies That Include Living Benefits
Several Mutual of Omaha policies come with living benefits, either built-in or as optional riders:
Term Life Express
This simplified issue term life product includes living benefits for terminal, chronic, and critical illness as part of its standard offering. It is designed for fast approval and requires no medical exam for many applicants.
Income Advantage IUL (Indexed Universal Life)
This permanent policy accumulates cash value and includes living benefits to provide greater financial flexibility. It is suitable for people interested in long-term wealth protection and legacy planning.
Life Protection Advantage IUL
Offers the same core living benefits as Income Advantage but is structured more for lifetime protection rather than cash accumulation.
How the Benefits Work
To access living benefits, a policyholder must:
- Be diagnosed with a qualifying illness
- Submit a claim along with appropriate medical documentation
- Receive approval from Mutual of Omaha’s underwriting team
Once approved, a percentage of the policy’s death benefit is paid out as a lump sum or structured payments. This amount is subtracted from the final death benefit, meaning your beneficiaries will receive less upon your passing.
The actual percentage you can access depends on:
- The policy’s face amount
- Severity of the illness
- Life expectancy at the time of claim
Pros of Mutual of Omaha’s Living Benefits
1. Included at No Extra Cost
In many cases, the living benefits riders are built into the policy with no additional premium.
2. Broad Illness Coverage
The combination of terminal, chronic, and critical illness coverage ensures a wide range of scenarios are covered.
3. Financial Flexibility
Funds received can be used for any purpose—medical bills, caregiving, debt payoff, or simply making the most of your remaining time.
4. Simplified Underwriting Options
Products like Term Life Express are designed for fast, simplified approval, making living benefits more accessible.
Things to Watch For
- Reduces Final Death Benefit – Any accelerated payout lowers what your beneficiaries will receive
- Not Available in All States – Rider availability and terms vary by location
- Administrative Fees May Apply – Some claims may incur service charges
- Approval Required – A physician’s certification and formal underwriting approval are needed to trigger the benefit
Who Should Consider These Policies?
Living benefits are particularly valuable for:
- Primary earners worried about income loss during illness
- Seniors concerned about long-term care expenses
- Individuals without disability or critical illness coverage
- Families who want financial flexibility in the face of a serious medical diagnosis
Final Thought
Mutual of Omaha’s living benefits provide a practical way to get more from your life insurance policy—before death occurs. Whether you're seeking term or permanent coverage, these features turn a traditional policy into a financial resource that works when you need it most.
For those looking to protect their families while also preparing for unexpected health challenges, Mutual of Omaha offers competitive, accessible, and well-structured living benefit options. Be sure to review each policy’s terms, eligibility criteria, and state-specific details with a licensed insurance advisor to determine the best fit for your goals.