What Are The Different Types Of Riders Available In Life Insurance?
Life insurance riders can make your policy more flexible and add useful features to it. They work by changing the terms or conditions of a policy, and if you meet the rider’s requirements while it’s still active, you’ll be able to file a claim with your insurer to initiate the rider’s benefits.
Many insurance companies automatically include certain riders, or they’ll allow you to add riders while you’re shopping for life insurance. However, not all insurance companies offer the same riders, and some may only be available with certain types of life insurance.
If you’re considering adding a rider to your life insurance policy, make sure to read the fine print as the rules for each rider can vary greatly from one company to another. Some of the most common types of riders in life insurance include:
| Rider Type | Description |
|---|---|
| Accelerated Death Benefit Riders | Allows you to claim some or all of your death benefit while you’re still alive if you meet certain conditions, typically related to a qualifying serious/terminal health condition |
| Critical and Chronic Illness Riders | Provides access to your death benefit if you’re diagnosed with certain qualifying conditions that are different from those covered under an accelerated death benefit rider |
| Long-Term Care Riders | Allows you to access your policy’s death benefit while you’re alive if you need qualifying long-term care, either by reimbursing you for covered expenses or via a lump sum to be used however you like |
| Waiver of Premium Riders | Waives your policy’s premium if you develop a qualifying disability and can’t work |
| Child and Spouse Riders | Provides a small death benefit if the insured child or spouse passes away during the rider’s term, typically to cover medical bills and funeral expenses |
| Family Income Riders | Provides an additional death benefit that’s paid out in monthly installments after the insured dies, through the end of the policy’s term, often purchased by sole breadwinners with a term life insurance policy to ensure their family still has a regular income if the insured passes away |
| Accidental Death and Dismemberment (AD&D) Riders | Increases your life insurance payout if your death is caused by a covered accident, and can also pay out a certain amount if you suffer a qualifying injury caused by an accident |
| Cost of Living Riders | Gradually increases your policy’s coverage over time in step with the Consumer Price Index so the value of your policy doesn’t erode due to inflation, with your premium increasing alongside your coverage amount |
| Guaranteed Insurability Riders | Allows you to periodically add more coverage to your policy without undergoing a life insurance medical exam, most common on whole life insurance and universal life insurance policies |
| Return of Premium Riders | Refunds all or some of your term life insurance premiums at the end of your policy’s term, so long as the death benefit hasn’t been paid out, with the benefits often depending on your investment strategy |
| Term Life Insurance Riders | Allows you to purchase additional term coverage on top of your permanent life insurance policy for a set period of time, giving you a larger death benefit, with a term conversion rider allowing you to convert a term life insurance policy into a whole life policy near or at the end of the term |
Adding any sort of rider might increase your premium, so make sure to quote your policy both with and without the rider you’re considering to see how much it changes your price. A financial advisor can also help you consider if certain riders fit into your family’s financial planning.
