Ensure Insurance: What Is a Life Insurance Policy Rider?

what is an insurance policy rider

Every life insurance policy offers a core promise: to pay out a benefit after your death. Polices begin to differ when the insurance company adds terms or conditions.

The terms and conditions of your life insurance policy are called riders. What is an insurance policy rider? Keep reading for a full definition and examples of riders you'll see in your policy.


What Is an Insurance Policy Rider?

In the insurance industry, a rider is a provision that changes the terms of the primary policy promise (i.e., the benefit). A rider can add coverage or provide a way for the insurer to take coverage away.

Typically when you choose a rider that adds a benefit or improves the terms, you need to purchase the rider. However, the cost isn't usually expensive because you already have approval for the policy, so the added terms require less underwriting.

When would you choose a rider? You might consider them when the standard policy doesn't cover a specific need.


What Are the Most Common Examples of Life Insurance Policy Riders?

Riders add and detract from the standard insurance policy to customize it for your needs. What ways can you change your insurance policy?

The most common example of a life insurance rider is the guaranteed insurability rider. The guaranteed insurability rider allows you to purchase additional coverage for your policy without being subject to a medical exam. For example, if you are a man who bought life insurance when you were 50, and now you decided to get remarried and have another child at 60, you would want more life insurance to cover your new wife and child.

Guaranteed insurability riders also allow you to grow your insurance benefit even if your health declines. However, they typically don't apply after a certain age, so you can't double the size of your insurance at age 80.

Another common rider is the accidental death rider. It pays an additional amount on top of the benefit if you die as the result of an accident. Each insurance company defines "accident" in its way, so it's essential to read the rider carefully.

The third example is the family income benefit rider. The income benefit rider pays out the death benef it to surviving family members through a long-term income plan rather than as a lump sum.

Another way to change your policy is through a long-term care rider. The long-term care benefit allows you to receive monthly payments from your benefit if you find yourself in a nursing home or requiring at-home care. Buying it through your life insurance policy is an alternative to purchasing a long-term care insurance policy individually. 

These policies are increasingly popular as the cost of care skyrockets.


Personalize Your Insurance Policy by Reading Riders Carefully

What is an insurance policy rider? It's an opportunity to build your life insurance into a tool that protects you and your family - no matter what comes your way. Riders allow you to add benefits to your policy, but insurance companies can also use them to take benefits away.

Did we answer your questions on life insurance riders? Learn more about building the best life insurance policy in our Insurance section.