Final answer:
Using the accelerated benefits rider on a life insurance policy allows the policyholder to receive part of the death benefit early, usually due to a serious medical condition. The amount withdrawn is then deducted from the final death benefit, thereby decreasing it, hence, the answer is B. The benefit will be decreased.
Step-by-step explanation:
When Jack takes advantage of an accelerated benefits rider on his life insurance policy, it allows him to receive a portion of his death benefit while he is still alive, usually in the case of a terminal illness or severe medical condition. An accelerated benefits rider is a feature available on some life insurance policies that can provide financial support when policyholders need it most.
The amount Jack receives with the accelerated benefits rider is then deducted from the death benefit his beneficiaries would receive upon his passing. Additionally, there may be some administrative fees or interest applied to the advanced amount, further reducing the remaining death benefit. It's important to realize this because it has a direct impact on the financial support provided to beneficiaries after the policyholder's death.
Therefore, the correct option in response to the question, 'If a benefit from this rider is paid, how does it affect the policy's death benefit?' is B. The benefit will be decreased. The payment made to Jack while he is alive is subtracted from the total death benefit amount, reducing the sum that will eventually be paid out after his death.