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Life insurance policy riders worth looking at

A policy rider is a provision or modification that can be added to a policy which provides additional coverage on top of the standard policy. Generally, each of these riders has a cost that is added to the premium if you choose to elect them.

 

There are many riders to choose from, and it can be overwhelming to pick and choose. For example, there is one called an accidental death (double indemnity) rider, in which the policy pays double the agreed upon face amount if death was a result of an accident, and occurred before a specific age and within 90 days of the accident. 

 

If you choose to select riders, there are two that I would highly recommend, and they are the waiver of premium and guaranteed insurability riders.

 

If the waiver of premium rider is selected, and the insured becomes totally disabled, the insurance company waives the premiums for the duration of the disability. You can expect about a 6 month time period which must pass before the premiums are waived. This rider will protect you until a specific age, 60 or 65, stipulated in the contract. Cash value and dividends, if permanent insurance, continue to grow as if you were making your normal premium payments. Statistically, you are much more likely to become disabled than to die prematurely, and a disability would probably prevent you from earning thus could prevent you from being able to pay your life insurance premiums, therefore it makes sense to pay the very small cost of this rider which could bring a potentially huge benefit.

 

When you apply for insurance, the insurance company usually looks at the results of your medical exam, and takes several other things into consideration, including any medication you are taking, illnesses past and present, your driving history, age, gender, etc. Based on this information, they assign you a premium classification based on your risk factor to the insurance company. When you select the guaranteed insurability rider, you will be allowed to purchase additional insurance at certain ages without showing evidence of insurability (no medical examinations required). You will pay for the insurance at your attained age of additional purchases, and your risk classification will be the same as the one you got when you were assigned from the start. The key thing to remember is, regardless of your health status, or even if you suddenly take up dangerous habits like sky diving, as long as you are within the window periods where you can buy more insurance, and have selected the guaranteed insurability option, you will be able to get the insurance.