An insured receives an accelerated benefit payment under a living benefit rider and later dies. Under Michigan law, how does the advance affect the death benefit paid to the beneficiary?

Why A is correct

Michigan's accelerated benefit statutes, M.C.L. 500.3928 and 500.3949, treat the living benefit as an advance against the death benefit: when the insured dies, the amount already accelerated is subtracted, and the beneficiary receives the remaining death benefit. The rider speeds payment up; it never increases the total amount payable under the contract.

Why the other options are wrong

• B) The advance is deducted, not added; paying the full benefit plus the advance would misstate how acceleration works.
• C) The policy does not terminate on payment of an accelerated benefit; the remaining death benefit stays payable.
• D) No repayment by the beneficiary occurs — the advance is simply subtracted from the death benefit at the insured's death.

Memory hook

Paid early, deducted later — one death benefit, two dates.