Can I Protect My Coverage with a Life Insurance Rider If I Become Disabled?
What is a Rider on an Insurance Policy?
A rider is an addition to a life insurance policy that provides extra benefits to a standard life insurance policy which may have an additional premium. There are many types of life insurance riders available that can expand or protect your coverage should you experience certain life events. Developing a critical illness or outliving your term life insurance policy are two examples of such events.
Life Insurance with Disability Rider
A common rider that may protect your life insurance coverage if you become disabled is known as a Waiver of Premium rider. This rider will provide payment for premiums after six months of a disability. It means that you won’t need to pay your life insurance premiums after the first six months of being disabled and your coverage will remain active. Some insurers may also return any premium payment made during this period once the six-month threshold has been reached. This can be especially helpful when you need to use your income or savings to pay for day-to-day healthcare costs. Waiver of insurance premiums will continue if you are disabled, or for a set period as stated in the terms of the policy. This rider is available up until age 55 from most companies at additional cost. Coverage usually ends at age 60.
Depending on your insurer, your disability rider on your life insurance may be known as a disability income rider. Here your policy may also pay out a monthly income of 1% of the coverage amount of the insurance policy. It’s designed to help replace your income in the event you become disabled. Be sure to clarify what exactly your disability insurance rider covers if you choose to add this type of rider to your plan. You may want to add both a disability waiver of premium rider and a disability income rider if your insurer considers these different riders.
What other types of Insurance Riders are there?
There are numerous types of riders available to increase the benefits of your coverage or add extra protection to your plan. Several types of insurance riders are available:
- Disability Waiver of Premium Rider – With this rider, you don’t have to pay the premium if you become totally disabled and can’t work. The rider kicks in once you’ve been disabled for six months.
- Term Conversion Rider – Term life provides coverage for a certain period. A permanent life policy, such as whole life or universal life, provides coverage for your entire life, so your beneficiary receives a benefit no matter when you die. A term conversion rider allows you to convert your existing term life plan into whole life coverage without repeating the application process.
- Accelerated Death Benefit Rider – Also known as a life insurance terminal illness rider, this rider lets you collect a portion of the policy’s death benefit if you become terminally ill and have a short life expectancy, such as one year. The remainder of the death benefit will be paid to the beneficiary when you pass away.
- Critical Illness Rider – The insurer pays a lump sum if you’re diagnosed with one of the critical illnesses specified in the insurance policy. Instead of reimbursing you for medical expenses, the way health insurance does, the rider provides money to use for any purpose during the course of treatment.
- Child Protection Rider – This term life insurance rider adds coverage for the loss of a child to your life insurance plan. It provides for final expenses in case the unthinkable happens.
- Accidental Death Benefit Rider – If you die from an accident, this rider provides an additional benefit on top of the policy’s regular death benefit.
- Return of Premium Rider – This optional extra is an additional premium that guarantees the return of your premium payments if you outlive your policy. In most circumstances you get all your money back if you live to the end of the term.
Get Your Questions Answered
Still have questions about how disability waiver of premium riders can protect your life insurance coverage? Our licensed agents are available to answer all of your questions. Call us today to find the best life insurance plan for your needs and your budget!