Riders are benefits that can be bought and added to an insurance policy. Below is a list of the most common riders. Please note that terms vary by states and companies.:

Accidental Death:

This rider pays out an additional amount of death benefit if the insured dies as the result of an accident. Usually, the additional benefit paid out upon death due to accident is equal to the face amount of the original policy, which means that it doubles the benefit. The cost and availability of this rider varies and is relatively inexpensive. Be aware that there are accidental death policies only as well. We strongly advise against such policies since the vast majority of deaths are due to causes other than accidents.

Waiver of Premium Rider:

With this rider, future premiums are waived if the insured becomes permanently disabled or loses his or her income as a result of injury or illness prior to a specified age. Disability of one of the income earners can have a devastating effect on a family. The premium is waived under these circumstances until he or she is ready to work again.  The definition of the term “totally disabled” may vary from one insurer to another, so be aware of the terms and conditions of your specific rider.

Accelerated Death Benefit Rider:

Under an accelerated death benefit rider, an insured person can use the death benefits if he or she is diagnosed with a terminal illness that will significantly shorten the insured’s life expectancy. On average, insurers advance 25-50% of the death benefit of the life policy to the insured. Usually, this money is used to pay for expensive (trial) treatments that are not yet approved and/or covered by insurance or simply to allow the terminally ill individual to enjoy life.
Insurance companies may subtract the amount you receive, plus interest, from what your beneficiaries receive on your death. Most often a small premium or, in some cases, no premium, is charged for this rider. Insurers have different definitions of “terminal illness,” so check what the rider covers before purchasing it.

Child Term Rider:

A Children’s Term Insurance Rider pays a life insurance benefit if any of your children pass away. This includes your biological children, stepchildren and legally adopted children at the time of application. Most companies will have some sort of minimum age such as 15 days after birth. Children adopted or born after the policy is issued are also covered. Your children are covered until they reach the a certain age in young adulthood or if they are married, whichever comes first.

Long-Term Care Rider:

In the event the insured has to stay at a nursing home or receive home care, this rider offers monthly payments. Although long-term care insurance can be bought individually, insurance companies also offer riders that take care of your long-term care costs which is becoming a lot more common nowadays. (For related reading, see: Long-Term Care 101)

Return of Premium Rider:

With this rider, you pay additional premium so that at the end of the term, your premiums are returned to you in full. In the event of death, your beneficiaries will receive the paid premium amount. Insurers sell this rider with many variations so we make sure you understand the ins and outs before paying the additional premium, especially since this option isn’t for everyone.

Understanding the provisions of your insurance policy are your responsibility. It is our job to educate you on the details.  Riders may provide much-needed options so we strongly advise to discuss your options with one of our licensed agents. For more information, please give our licensed agents a call at 425-242-5252 or send us an email to life@dokagency.com.