In what case would an accelerated death benefit typically be accessed?

An accelerated death benefit is designed to allow policyholders to access a portion of their life insurance policy's death benefit while they are still alive, typically in cases of terminal illness. This means that when a policyholder is diagnosed with a terminal illness, which is generally defined as an illness that is likely to lead to death within a specified time frame (often 12 to 24 months), they can tap into these funds. This can provide financial support for medical expenses, care, or other needs during what can be a challenging time.

The other scenarios presented do not align with the typical conditions under which an accelerated death benefit would be utilized. For instance, reaching age 65 does not necessarily indicate a need for accessing these benefits, nor does a chronic illness typically qualify, as chronic conditions might not meet the critical criteria of being terminal. Furthermore, simply paying the last premium does not trigger any benefits related to the death benefit before the policyholder's death. Therefore, accessing an accelerated death benefit is primarily associated with a diagnosis of a terminal illness.