Life Insurance Policy Riders
By: Elizabeth Silvestri, CFP^®
The Henssler Financial Group Position Paper

Accidental Death Rider
Under this provision, if the death of the insured is caused by an accident and the death is within 90 days of the accident, an additional sum equal to the amount of the rider will be paid. The premium for this rider is not very high because most deaths do not fall under this category. Death from an illness is more common than death from an accident.

Common Disaster Rider
Under this provision, a settlement of policy proceeds is withheld for a specified number of days after the insured's death. Any surviving beneficiary who dies within that period is considered to have predeceased the insured.

Conversion Provision Rider
Under this provision, the insured is given the option to exchange a term contract for some type of permanent insurance without having to provide evidence of insurability.

Disability Waiver of Premium Rider
Under this provision, the insurance company agrees to waive the entire premium or the monthly charges, whichever applies, if the insured becomes totally disabled in accordance with the provisions in the contract. This is usually before a certain age (i.e., 65). The premiums do not have to be paid by the owner of the policy, and the policy coverage is not terminated. Coverage continues as if premiums are being paid.

Family Income Benefit Rider
Under this provision, the life insurance company pays the death benefit and a monthly income to the family for the remainder of the duration of the family income arrangement (as determined in the policy). For example, if a family has a 10-year family income arrangement, the life insurance company pays the family's monthly income for the rest of the covered time after the insured has died. Payments can be made monthly or in a lump sum.

Guaranteed Insurability Rider
Under this provision, the insured is allowed to purchase additional specified amounts of insurance at stated intervals without providing evidence of insurability. The rider gives specific dates on which additional life insurance policies can be bought. The older the insured, the fewer dates the policy owner has to purchase additional life insurance. This can be a beneficial provision for a person who has medical problems in their family or expects that his or her health may change in the future.

Renewability Provision Rider
Under this provision, the insured is guaranteed the right to renew a policy for a specified number of additional periods. This provision is available with renewable term insurance.

Spendthrift Clause Rider
Under this provision, the beneficiary is denied the right to commute or assign interest in the policy proceeds paid under an installment settlement option. It must be requested in writing.