What is the significance of a "living benefits" rider?

A "living benefits" rider is significant because it allows the policyholder access to a portion of the death benefit while they are still alive. This rider is particularly valuable in situations where the insured faces a terminal illness, chronic illness, or critical condition, enabling them to use the funds for medical expenses, debt, or other financial needs. By providing this access, the living benefits rider offers financial flexibility and support during crucial times, ensuring that individuals can alleviate some of the financial burdens they may encounter due to serious health issues.

In contrast, the other options do not accurately describe the purpose of a living benefits rider. Unlimited coverage while alive isn't a characteristic of this rider, nor does it guarantee a set return on investment or eliminate the waiting period for benefits, which are traits associated with different aspects of life insurance or riders.