What is an insurance rider?
And why is it important for you to know a bit about them prior to getting an insurance quote?
An insurance rider is a basically an amendment to an insurance policy. It gives you (or the person getting the policy) more protection than what the basic policy offers.
Here are some reasons for expanding your coverage…
10 Insurance riders to consider
1. A rider to cover insurance payments in the event of a disability and income during your disability or critical illness.
There are a variety of different disability related waivers: a waiver to cover premium rider will cover premiums if you are disabled or can’t work, the disability income rider allows you to collect an income from the insurance company if you become disabled and a critical illness rider pays a lump sum if you are diagnosed with a serious illness.
2. Riders to cover accidental death pay an additional amount of money on top of the original death benefit.
This option is referred to as double indemnity when the additional benefit equals the original death benefit. Often accidental death benefits will cover the loss of a limb or eye, as well.
If you work in a high risk field, your premiums would reflect this.
3. Term conversion riders if you want to switch to a whole life policy.
Term policies cover you for a specified time, say 10, 20 years Whole life covers you for your entire life. This type of rider allows you to switch to whole life without a medical exam.
There is usually a deadline when you need to convert the policy.
4. Guaranteed insurability riders that guarantee coverage after a certain age.
These riders allow you to purchase additional coverage without a medical exam. This option allows you to buy more insurance at certain intervals of every two to three years for example, at specified ages.
5. A rider that offers accelerated death benefits.
In the case of a terminal illness, these funds can pay hospital bills for example.
These are quite common in the insurance industry and cost very little. These riders allow you to collect a portion of the death benefit. Each policy spells out how much is available before death.
6. The return of premium rider will refund the premium amount if you live to the end of the term.
Some companies write the return of premium into their base policies. You do pay a higher premium to get your money back.
Something to consider: How does paying this extra cost compare to investing this money?
7. You live in a flood zone.
This insurance rider is provided by the Federal Government for properties located in flood zones. Earthquake riders are also available if you live in an earthquake zone.
8. Travel insurance covers trip costs if you can’t travel.
Most good plans provide coverage for trip cancellation, travel delays, lost luggage, medical emergencies and more.
And often kids are covered at no additional cost.
9. You have hard to replace valuable property.
This rider provides additional coverage for “high ticket” items, such as:
- collections and collectibles
Or you just received an engagement ring.
10. If you are having an event, consider liability insurance or liquor liability insurance.
This rider will provide coverage for you if there is a slip and fall resulting in a law suit, for example.
The liquor liability insurance will cover your legal defense fees if a guest is involved in an accident after drinking at your event.
So which ones are right for you?
When it comes to getting the right insurance coverage at the best possible price, it makes sense to speak with an insurance specialist. That way you can get the policy you need that is best suited to your situation.
Does that make sense to you?
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