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What Are Insurance Riders?

What Are Insurance Riders?
March 08, 2021

What Are Insurance Riders?

For some people, life insurance is not just an investment to protect themselves. It’s to protect those they love as well. With this in mind, it’s crucial to think just how well your insurance policy can protect those you love. Is your life insurance policy enough? Should you add riders to your policy? What are riders anyway? Are there different kinds of riders?

In this article, we’ll be discussing everything you need to know about insurance riders.

What does a rider in insurance mean?


In insurance, a rider is an optional add-on you can include in your policy. There are two main categories of riders: living benefit and death benefit riders. The main difference between the two is who can use the benefits.

A living benefit rider means that you can use some of the money that was intended for your beneficiaries for yourself (that is supposed to be claimable after your demise) while you are still alive. Death benefit riders, on the other hand, exclusively receive your benefits after you pass.


Insurance rider types


Accidental Death - Accidental Death riders provide an additional benefit equivalent to the face amount of the policy if the insured dies due to an accident. That’s doubling the insurance benefit of your policy.

Special Accident RiderSpecial Accident Rider pays additional benefit covering not only death but also certain specified injuries which the insured may suffer because of an accident. Broken bones, impairment, loss of use, etc. are some of the types of injuries someone may sustain from an accident.


Special Accident Rider with Disability Indemnity - The Special Accident Rider with Disability Indemnity expands the benefit of the Special Accident Rider, by providing a weekly income in case of partial, temporary, total, and continuous disability due to an accident. The weekly income can answer for the insured’s needs temporarily until a permanent source of funds to treat or manage the disability is established. This amount is paid for a maximum of 52 weeks.


Dread Disease Rider - Dread Disease Rider is an example of a health insurance rider that provides a lump sum amount when the insured is diagnosed with any of the covered dread diseases. This frees the insured from worrying about the medical and treatment costs associated with his condition, thereby allowing him to focus completely on the recovery journey.


Hospitalization Rider - Hospitalization Rider provides daily hospitalization allowance if the insured is hospitalized as a result of injury or sickness. The amount can be used to partially pay for room and board upon confinement.


Hospitalization Plus Rider - Hospitalization Plus Rider is an enhancement of the Hospitalization Rider through a cash bonus to be given every five (5) years provided there was no hospitalization claim for the prior five-year period. This benefit is meant to reward the policyholder for keeping himself in tip-top shape. The funds can be used for regular check-ups or for health-related expenses meant to ensure continued good health.


Benefits of an insurance rider


Insurance riders allow you to customize your policy and give you additional coverage for the circumstances and people you need. It allows you to modify your plan to ensure every facet of your life is covered just the way you want it to be. Through insurance policy riders, you can ensure you add more value to your policy and get a return on your investment.

We hope this helped you understand more about insurance riders. If you have any more questions or would like to know which ones would best suit your policy, get in touch with one of our Financial Advisers today!

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