Life Insurance Policy Riders

life riders

When it comes to life insurance, there are a lot of options out there. It may seem overwhelming at times, thinking that you don’t understand the full picture – yet. In this guide we will be going over some of the add-ons that can come with a whole life insurance policy. These can be great benefits, often times at little extra cost or even included for free.  

Accelerated Death Benefit for Chronic Illness  

Having a chronic illness is a lot more common than people tend to realize. According to the CDC, 78% of Americans 55 years or older have at least one chronic condition. The most common conditions are:  

  • Cancer 
  • Asthma 
  • Arthritis  
  • Chronic Obstructive Pulmonary Disease (COPD) 
  • Cardiovascular Disease (includes a number or different heart diseases such as hypertension and history of heart attack) 
  • Diabetes  

The benefit of this rider is that you can get portions of your death benefit amount before you pass away. With most life insurance policies, you don’t see the benefit until after you pass away. Your life expectancy plays a role in how much and how often you can withdraw. Having this money can help to pay for major medical expenses, hotels, or help pay for the mortgage while in treatment.   

Accelerated Death Benefit for Terminal Illness 

This rider is similar to the chronic illness rider, in that you get a portion of the death benefit before you pass away. The difference is that it is a terminal illness meaning that person has 12 months or less to live. These situations are difficult for the individual and their family. Having some extra money can help settle affairs that may be left, such as paying off the rest of the mortgage or put away for a college tuition. Sometimes there is a small fee of $100 or less and you can withdraw up to a certain amount of it, usually around 80%.  Imagine getting proceeds of a life insurance policy before you pass away. This rider can help someone that is facing a terminal illness enjoy the little life they have left.

Guaranteed Refund Option 

The guaranteed refund rider seems to get glossed over when learning about life insurance. It is a key component to a whole life insurance policy and should be something to keep in the back of your mind. This rider allows you to get a refund of all the premiums you’ve paid up to that point. This option is usually only available up to 25 years. After 25 years with the policy, this option would no longer be available. This could be used as an emergency fund in addition to the traditional benefits from a life insurance policy. For an average policy, after 25 years you could see a return of over $35,000. Having this option available could be help make decisions down the road. Can you imagine getting a full refund of all the premiums you paid? That’s a win for you!

Long-Term Care (LTC) Rider 

When getting older, the odds of having to go into a sort of long-term care program gets higher. You may know someone in a facility like this who was critically injured or suffers from chronic illnesses. Whether it’s a nursing home, assisted living, or hospice care, they all can cost a lot of money. This is where this rider comes in handy.  

Overall, having more options just lends credence to life insurance being a flexible asset. One that can fit any persons situation or budget. Book a meeting with us and see what kind of coverage your family needs.  

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