---
title: "What Is Death Benefit? Definition | Epic Life Glossary"
description: "A death benefit is the money a life insurance carrier pays to the beneficiary when the insured dies. It is usually paid as a lump sum and is generally..."
url: https://epicline.preview.multisites.ai/glossary/death-benefit
publisher: Epic Life Group
apply: https://epicline.preview.multisites.ai/apply
quote: https://epicline.preview.multisites.ai/get-a-quote
---

Policy mechanics

# Death Benefit

A death benefit is the money a life insurance carrier pays to the beneficiary when the insured dies. It is usually paid as a lump sum and is generally income tax free to the beneficiary.

## Why it matters

Families use the death benefit to cover funeral costs, debts, living costs, and lost income. The amount depends on the face amount, riders, and any loans. Some policies pay less during an early waiting period. Federal rules often exclude the payout from income tax, but there are exceptions such as interest paid or transfers for value. Ask a tax professional about your case.

Source: [irs.gov](https://www.irs.gov/publications/p525)

[Read next, for familiesHow do you file a life insurance claim after a loved one dies?](https://epicline.preview.multisites.ai/guides/how-to-file-a-life-insurance-claim)

## Where we use this term

-   [How much does final expense insurance cost, and what sets the price?](https://epicline.preview.multisites.ai/guides/final-expense-insurance-cost)
-   [Fixed vs fixed index annuity: how do they work and who do they fit?](https://epicline.preview.multisites.ai/guides/fixed-vs-fixed-index-annuity)
-   [Guaranteed issue vs simplified issue: which fits your health and age?](https://epicline.preview.multisites.ai/guides/guaranteed-vs-simplified-issue)
-   [Indexed universal life (IUL) explained: caps, floors, costs, and risks](https://epicline.preview.multisites.ai/guides/iul-explained)
-   [Mortgage protection vs term life vs PMI: who does each one protect?](https://epicline.preview.multisites.ai/guides/mortgage-protection-vs-term-life-vs-pmi)

## Talk to a licensed agent.

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