Top 5 Life Insurance Riders

Life Insurance Riders: Top 5 Riders to Add to your Life Insurance Policy

Avoid put your family’s financial security at risk by adding life insurance riders

By Meha Ahmad, Insuranceagents.com Staff Writer

Everyone, especially those who contribute to household incomes, should consider adding riders to their life insurance policy. It’s true; a life insurance policy isn’t exactly the cheeriest of topics at the dinner table. But when your property and your family’s financial future and security are at risk, an insufficient life insurance policy is all that stands in the way of you and peace of mind. Drafting a life insurance policy is serious business; making sure the life insurance policy offers all the necessary coverage is even more serious. Adding life insurance riders to your policy ensures the peace of mind you may crave.  It's easy to figure out the costs of your policy with additional riders by simply requesting a few free life insurance quotes.  Make sure your agent is willing to give you insurance quotes that include the difference in cost if you mix and match riders.

What is a life insurance rider?

Riders are amendment or special additions added to the life insurance policy, providing some specific coverage at the request of the policyowner. Each rider usually costs the policyholder an additional amount.

The amount of and the kinds of life insurance riders one needs varies from person to person. Your lifestyle, your beneficiaries’ needs will all yield different coverage needs and therefore, different life insurance riders. But some life insurance riders are fairly universal and generally a good idea for every policyholder to add to their life insurance policy. You can compare life insurance riders by using our online life insurance comparison service.

Here are the top five life insurance riders we think most policies can’t do without:

• Life insurance rider #1: Accidental Death Benefit – When added to a life insurance policy, this rider secures an additional amount of money to be paid to the beneficiary/beneficiaries if the policyholder dies as a result of an accident. Often referred to as “double indemnity,” this life insurance rider usually doubles the amount of the death benefit.
• Life insurance rider #2: Waiver of Premium Rider – This life insurance rider waives the responsibility to pay the premium if and when the policyholder becomes disabled, during the length of time the policyholder is disabled. Premiums must be paid, but if the insured has become disabled and suffers from loss of income as a result, the waiver of premium life insurance rider will guarantee the active status of your life insurance even if the premiums are not paid. A similar life insurance rider that is especially beneficial is the disability income rider, which secures a monthly income should the insured become permanently disabled.
• Life insurance rider #3: Accelerated Death Benefit – This life insurance rider allows the insured to collect either all or a portion of their life insurance policy while they are alive. The insured can claim this rider if he/she is diagnosed with a terminal illness, requires long-term care or admission to a nursing home. With these conditions, the insured would most likely be unable to continue work and earn an income. This life insurance rider can help relieve some of the financial burden and medical costs.
• Life insurance rider #4: Renewal Provision/Guaranteed Insurability Rider – This life insurance rider guarantees your life insurance policy’s renewability at the end of its term (assuming you purchased a term life insurance policy rather than a permanent whole life insurance policy). Upon renewal, you can add coverage to your policy and will not need to provide further proof of your insurability. However, consult with your insurance agent to find out whether your provider grants this rider with conditions (does it expire after a certain age? Is renewability only valid within a set time period?). This life insurance rider is especially valuable because a term life policy may expire before the policyholder has passed on, but at a time when the policyholder’s condition is uninsurable. 
• Life insurance rider #5: Family Income Benefit Rider – This life insurance rider provides a continuous monthly payment to your beneficiaries in the event of your death. Rather then receiving one lump sum, your beneficiaries can receive the death benefit in monthly payments, which means a reliable source of income. When adding this life insurance rider, the insured (you) chooses the length of the term you would like to provide this income security.

Though the above life insurance rider are recommended and most commonly added to a policy, that doesn’t mean you absolutely need each one. For every policyholder and their family, the choice of which life insurance riders are needed differs. Always consult with your insurance agent to best choose which life insurance riders are most beneficial to you and your family. Keep in mind that each life insurance rider usually adds a certain cost to your premium; to balance the cost to you, look for affordable life insurance quotes and find a life insurance policy that fits in your budget, even if you add several life insurance riders. The quickest way to save money on a new life policy and examine your options with riders would be to use our online quote service by filling out a simple online form.

Published: Tuesday 7th July 2009