Riders are options to add on to a life insurance policy. It’s akin to adding toppings to a pizza. The riders can change the plan from a mere death benefit, to something that really booms.
Rider Examples
Return of Premium (term life only)
This rider returns all of your premiums at the conclusion of your policy. In other words, every cent you pay into your term policy is refunded to you in a lump sum when your term is over. This is probably the most valuable rider in all of insurance. It does increase the cost of your policy by about 100%, but you do receive a refund of that money in the end.
Accelerated Benefits Rider
This rider pays out a large portion of your death benefit while you are still living if you become terminally ill. This helps pay for your medical bills while you are still alive.
Disability Waiver of Premium
One of the most valuable riders a plan can have because if you for whatever reason become disabled, the policy stays in force. If you’re doing whole life insurance right, you view it like a retirement fund, and no other retirement plan keeps contributing to your account when you can’t. On top of that, it pays you a disability payment up to $3000 for a specified amount of time, usually 2 years.
Critical Illness
The Critical Illness Benefit Rider pays a lump-sum benefit if the insured is diagnosed with a specified critical illness. This innovative coverage has two unique features: 1) Benefits do not decrease the death benefit but are paid in addition; 2) After first-ever diagnosis, insured is still eligible for benefits from multiple CI categories if continuing to pay premiums. Available on other insured.
Conclusion
Riders can add a lot of value to life insurance policies. Most people don’t realize the benefits they are passing up in regards to these add-ons. Of course, riders increase the expense of the policy, so it is important to balance what you want with what you can afford.
Blue Crush Insurance
