Riders may determine life insurance plan

Jun 21, 2011

Additional coverage can help life insurance policies

Choosing a life insurance policy can be complicated and expensive, leaving many people to often purchase the minimum policy, according to the Wall Street Journal. However, as people get older, make money or experience major life changes, they may want to amend these policies.

Experts believe that one of the best ways to amend a life insurance policy is with riders. A rider is purchased with a set premium and attached to a primary life insurance policy, according to the Insurance Information Institute (III).

Riders can be bought as added insurance protection for disability, cost-of-living expenses, long-term care and accelerated death benefits. A guaranteed insurability rider, or renewal provision, ensures that a person's policy will be renewed at the end of its term, according to the III.

One of the most common riders that people purchase is an accidental death benefit. This will allow beneficiaries to receive an additional amount of money if the policyholder dies as the result of an accident. It is important that people carefully read over the insurance company's definition of an accident, according to Life Insurance In-Depth.  

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