Life Insurance Extras

By Compuquotes Team on October 15th, 2009

Life insurance extras make your policy go further. They cover a variety of contingencies at minimal cost.

Buying life insurance is like going to the tailor and buying a new suit. make sure it fits well. You might wish to spend a little more on your premiums in order to save money in the long run, and take advantage of numerous riders tailored to fit your particular needs.

What Is a Rider?

According to the Wisconsin Office of the Commissioner of Insurance, a rider is "a document or form containing special provisions that are not contained in the policy contract. Such forms are to be added or attached to the policy." The good news is that most riders are relatively inexpensive in comparison to the premium required on the base policy. Generally, the rider cost is low because little additional underwriting is required for it.

Life insurance companies offer many types of riders with various names and various purposes. Some of them are only suited for permanent policies, while others are just for term policies. The most common ones are listed below.

Guaranteed Insurability

This rider is also called a "future purchase option," and is only available with permanent life insurance. It allows you to buy additional coverage at certain specific ages without proving insurability. Often, this rider is used when there has been a significant change in your life circumstances, such as marriage, the birth of your child, or an increase in your income. This rider is extremely important because you may not otherwise be insurable at a time when you most need it.

Waiver of Premium

If you were injured or ill and unable to work for a long period of time, paying your life insurance premiums would be one more difficulty for you. Fortunately, you can economically avoid that difficulty by buying a waiver of premium rider, which pays your life insurance premium should you become disabled.

Additional Family Member Rider

One of the best ways to save money on a permanent insurance policy is to purchase, as a rider, an additional amount of term insurance for your spouse, your children, or even yourself for a specified period of time.
� You can buy a $100,000 whole life policy on yourself, for example, and add on a $50,000 rider for just ten years until a mortgage or large debt is paid off.
� You can insure your spouse in order to pay for child care until the children are on their own.
� You can insure your children on your policy until they are of age. They can then convert to their own policy without proof of insurability.
These riders provide additional coverage at less cost than additional polices since term insurance costs less than permanent insurance. Furthermore, you are eliminating the administrative costs involved with a stand-alone policy.

Accidental Death

Also known as "double indemnity," this provision usually pays your beneficiaries twice the amount of your life insurance face value if you die in an accident. This is particularly important as you could be killed in an accident at an early age. Your family would then need your income for a longer time.

Living Benefits Rider

If you incur a terminal or catastrophic illness and need long-term or even nursing home care, you can receive the proceeds of your life insurance policy before you die.
It is important to note that when you actually pass away, your life insurance company will adjust your death benefit accordingly; however, you and your family would benefit from the timely financial relief offered by this rider.

Conversion Term Insurance Rider

You prefer a permanent life insurance policy, but right now you can only afford a term policy. What do you do? You can buy a conversion term insurance rider, which allows you to "convert" your plan to a permanent life insurance policy in the future. The great advantage is that you can do so without further proof of insurability.

Renewable Term Insurance Rider

Similarly, a re-entry or renewable rider allows you to buy a new level-premium term insurance policy after your old one runs out, again, without evidence of insurability.
Riders give you significant extras at a good price. See a professional life insurance agent to find a policy and riders that will provide you with both security and value. Get a good fit.

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