Understanding the Available Life Insurance Riders

March 23, 2018

Did you know that in addition to your basic life insurance you could add life insurance riders? Otherwise known as special endorsements, they offer special protection to help you customize your plan.

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Below we discuss the most common riders available to you with your life insurance policy.

What is are Life Insurance Riders?

First, let’s look at how life insurance riders can help you. They are policies that are in addition to your standard term or whole life insurance. Basically, they help give you the coverage that you need by offering additional coverage. You can customize what you pay for, therefore, minimizing paying for coverage that you don’t need. Riders are optional and only necessary if you need coverage that is not offered in your basic life insurance policy.

Child Coverage

If you want protection for your children, you can add a child term life insurance rider. One rider protects all of your children, whether you have one, five, or more children. It’s one premium and it provides coverage for newborns up to age 25 in some cases.

You can usually get coverage that varies between $1,000 and $25,000. Many families find this the most affordable way to cover their children. Some policies do offer this as a part of their standard life insurance. For those that don’t, though, this is a great policy to extend your coverage to your children.

Spouse Coverage

If you have a life insurance policy on yourself, you may be able to add a spouse rider. This gives your spouse the same coverage you have for a fraction of the cost of a separate policy. Many couples use this as insurance for burial or final arrangement costs.

Term Life

If you have whole life insurance, you may want the reassurance of a fixed amount of money going to your beneficiaries upon your death. The term life insurance rider provides this protection. Your loved ones get protection for a specified period of time (term) and for a fixed amount. This is often a less expensive way to add additional coverage onto your whole life policy without taking out a brand new policy.

Long-Term Care

While life insurance is typically used for when a person dies, if you have a long-term care rider it can help if you end up in a nursing home or assisted-living facility. The rider allows you to use some of your death benefit to pay for your care while you are still alive. The amount of coverage you have and the period it lasts depends on the type of coverage you purchase.

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Accidental Death

Life insurance obviously protects your loved ones in the event of your death. But, when your death is accidental, it could cause even more damages to your loved ones. The accidental death life insurance rider helps during these times. It gives your beneficiaries extra coverage beyond your standard life insurance policy. While not a common policy for most people, if you work in hazardous conditions or live a precarious life, it could be a good benefit to have for your loved ones.

Accelerated Death Benefit

Sometimes the insured need access to their life insurance money before they die. If you are diagnosed with a serious illness that is either chronic or fatal, you may tap into your proceeds with this rider. Generally, your quality of life must be greatly affected in order to have access to the funds. Each policy has different requirements regarding this rider, so make sure you know the details before accepting it.

Guaranteed Insurability

Sometimes you cannot afford the amount of coverage you want right away. With the Guaranteed Insurability Rider, you can purchase additional coverage without the need for a medical evaluation. Keep in mind, though, you can only purchase additional coverage at specific times in your life, known as life changing events. The most common examples include the birth of a baby or marriage. This is a great way to protect yourself should your health status change, but you want more insurance.

Waiver of Premium

In the event that you become disabled and are unable to pay your premiums because you cannot work, the Waiver of Premium Life Insurance Rider can help. This rider covers you until you are able to return to work, if applicable. The timeframe that this rider applies depends on your coverage and exact circumstances.

Life insurance riders can help give you the coverage you need when unexpected things happen. Life insurance is generally the least expensive when you buy it at a young age. Purchasing riders alongside the coverage can help you adjust to life as you age without paying the higher premiums you would pay as you get older and your health declines.

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