What If You Can’t Work? Protecting Your Income with Living Benefits

jmealpha1
May 5
4 min read

The One Question Most Business Owners Avoid

You plan. You produce. You perform.

But there’s one critical question many entrepreneurs and business owners never ask themselves:

What happens if I can’t work tomorrow?

Not because you don’t want to—but because life makes that choice for you.

A cancer diagnosis.

A car accident.

A stroke.

A sudden, chronic condition that limits your mobility, energy, or capacity to lead. If you’re the core of your company, losing your ability to work isn’t just a personal crisis—it’s a business one. Without a backup plan, income stops, responsibilities pile up, and the people who depend on you—your family, your staff, your clients—are left without support.

This is why living benefits matter.

What Are Living Benefits?

Living benefits are features included in many modern life insurance policies—especially Indexed Universal Life (IUL)—that allow you to access the policy’s death benefit while you’re still alive if you experience a qualifying event, such as:

A critical illness (cancer, heart attack, stroke)
A chronic illness (inability to perform daily activities)
A terminal illness (life expectancy of less than 24 months)

These benefits are paid out as an advance on your death benefit, giving you access to tax-free funds to replace income, cover medical costs, or simply keep your business afloat while you recover.

Why Traditional Disability Coverage Isn’t Enough

Some business owners carry disability insurance—and that’s smart. But in many cases, it’s not enough.

Most disability plans:

Require long elimination periods before benefits start
Replace only a portion of your income
Include restrictive definitions of disability
Are expensive for high-income earners

Worse, they rarely address what your business needs while you recover.

Living benefits through an IUL offer greater flexibility and a wider range of use. The payout can be used for:

Replacing personal income
Paying key employees to step in
Maintaining operations or vendor relationships
Hiring outside help to temporarily run the business
Offsetting medical expenses not covered by insurance

You don’t need to justify how you use the funds—you just need to qualify for the benefit.

The IUL Advantage: A Financial Safety Net You Can Access

An Indexed Universal Life (IUL) policy is built for more than death benefit protection. When properly designed, it serves as a:

Long-term asset
Tax-advantaged savings vehicle
Emergency fund
Business continuity tool

Living benefits are embedded in many of these policies through accelerated benefit riders. They allow you to access a portion (or all) of your death benefit while you’re still alive, giving you immediate financial support without taking on new debt or liquidating business assets.

Case Study: The Business Owner Who Beat Cancer—And Saved Her Business

Client Profile:

Tasha, a 46-year-old marketing agency owner, had built a thriving firm with five employees and a growing client base. As the lead strategist and rainmaker, her role was irreplaceable.

Tasha had set up an IUL policy a few years earlier. It included $1M in coverage and a living benefits rider. She saw it as future retirement income—but hadn’t given much thought to the illness protection.

At 48, Tasha was diagnosed with an aggressive form of breast cancer. She had to step away from the business for almost a year.

What saved her company?

She activated the living benefits in her IUL policy, accessing over $400,000 tax-free.

Those funds allowed her to:

Continue paying staff
Hire a temporary account manager
Cover personal expenses
Keep the business running during treatment

She beat cancer—and didn’t lose the business in the process.

Frequently Asked Questions

"How is this different from traditional life insurance?"

Traditional life insurance pays a benefit only after death. With an IUL that includes living benefits, your policy works while you’re alive. You’re not waiting for a claim—you’re accessing protection when it matters most.

"Are living benefits taxable?"

In most cases, no. As long as the benefit is structured correctly and paid under IRS guidelines, it is received tax-free, just like the death benefit.

"Do I have to use the money for medical expenses?"

No. Once you qualify, the funds are yours to use however you choose—whether for medical bills, replacing lost income, hiring staff, or personal needs. There are no restrictions or receipts required.

Protect Yourself Like You Protect the Business

You are the engine. The strategist. The leader. Without you, the business doesn’t just slow down—it may stop altogether. And while you can’t always predict what life will bring, you can prepare for it. A well-designed IUL policy with living benefits offers a powerful, flexible safety net that ensures:

Your income continues even when you can’t work
Your business doesn’t collapse under pressure
Your family isn’t left scrambling for solutions
Your recovery is focused on healing—not hustling

This isn’t just about insurance. It’s about resilience.

Let’s Build Your Income Protection Plan

At King Legacy Group, we help entrepreneurs build financial strategies that protect income, support the business, and create long-term freedom. If you’re the one holding everything together, let’s make sure there’s a plan in place if you ever need time to focus on yourself.

Schedule your complimentary LivingLEGACY™ Strategy Session today, and learn how to add living benefits to your financial plan.

Download our latest eBook, The Business Owner's Blueprint: A Strategic Guide to Creating Tax-Free Income, Business Continuity, and Multigenerational Legacy here.

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