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Understand how life insurance works

What is an insurance rider?

Couple discusses adding an insurance rider to their life insurance policy.

Whether you’re buying life insurance or looking to add extra benefits to your existing health care plan, knowing your options is an important factor for making a well-informed decision. When it comes to choosing an insurance policy, are you aware of the terms and potential extra benefits available? Insurance riders are like add-ons to an already existing policy. Purchasing a rider in addition to your current policy can help add extra benefits that you don’t need a full-scope policy for.

Why you would buy an insurance rider

So, why buy an insurance rider? For an extra cost to your overall premium, riders can provide extra coverage to an existing policy you have, or a policy you intend to buy. This can allow for some flexibility in the coverage you get from your policy, as you can add and remove coverage options as you need them. Riders can also be used to cover another person, like your spouse or child. Riders aren’t right for everyone, but they can be beneficial under the right circumstances.

Types of insurance riders

There are several types of insurance riders, and the ones you might choose depends on your individual situation. Here are a few of the common types you may encounter.

Accelerated death benefit rider

Also known as living benefits, this type of insurance rider allows you to access part of the funds from your life insurance policy early if you become terminally ill. You can use these funds to help cover your medical expenses, or to help set your family up with some financial peace of mind. Although this is commonly offered, make sure to ask your individual insurance provider for details before purchasing a policy.

You may wonder how this differs from withdrawing the cash value of a whole life insurance policy. While you may be able to access your cash value early, having an accelerated death benefit rider guarantees that you can gain access to the policy’s funds to help with bills, regardless of the cash value accrued. The amount you use is ultimately deducted from the death benefit amount of your policy’s coverage.

Child life insurance rider

Insurance companies may offer a child life insurance rider as an add-on to the parent’s life insurance policy. The cost of the rider is added to the parent’s premium, and coverage is generally provided to all dependent children in your household. Ages covered range from 6 months to 21 years, but make sure to double check the ages covered by your carrier if you’re considering this type of insurance rider.

Costs of an insurance rider

In general, the cost of an insurance rider depends on the type of rider you want and the type of insurance policy it’s being added to. Typically, the cost of adding an insurance rider to a policy depends on a few factors:

  • How much coverage do you need?
  • Will your policy be underwritten?
  • What type of insurance policy are you purchasing?

Deciding to purchase an insurance policy is a big step. It’s important to understand all the terms that come with it. That way you know what to ask for, what to look for, and what to add on if necessary. If you still have questions, we’re here to help.


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