What is Rider in Insurance?

What is an insurance rider?

While life insurance safeguards your beneficiaries, riders personalise your coverage with targeted benefits. This article explores rider types, functions, and advantages of a well-rounded insurance plan.

How does an insurance rider work?

Insurance riders are purchased in addition to your basic insurance policy. They supplement the existing coverage, often at a lower cost than buying a separate policy. Each rider addresses a specific need, ensuring more comprehensive protection.

Types of riders in insurance

The following are riders that are often added to a basic policy:

Critical illness rider

A critical illness rider enhances your life insurance policy by providing a total payout upon diagnosis of covered critical illnesses. This benefit can help manage financial burdens associated with treatment and lost income.

For example, Prudential offers riders like Crisis Care, providing a lump sum for critical illness and PRUWaiver for a premium waiver upon diagnosis.

Medical rider

A medical rider is an additional benefit to a life insurance policy that covers medical and surgical expenses incurred during hospitalisation.

If you’re looking for a medical rider, PRUValue Med funds your expenses when you require hospitalisation.

TPD rider

A Total and Permanent Disability (TPD) rider offers added financial protection to a life insurance policy. A TPD rider provides coverage if you become permanently disabled or are unable to work.

A good TPD rider that will supplement your insurance and provide you with extra coverage is Prudential’s Payor Basic rider.

Accidental death rider

An accidental death rider offers additional financial support to your beneficiaries beyond the basic life insurance policy.

The accidental death and disablement rider from Prudential provides an additional payout if the insured loses their life or the use of a body part due to an accident.

Spouse waiver

A spouse waiver is an additional benefit to a life insurance policy that waives future premium payments if the policyholder's spouse passes away or becomes disabled.

For example, the Spouse Waiver from Prudential ensures that all future premium payments are waived under such circumstances, providing financial relief during difficult times.

Mortgage rider

A mortgage rider pays off your mortgage if you pass away or become disabled, ensuring your family isn't burdened. Itprovides financial security and peace of mind, sparing your loved ones from mortgage payments during a difficult time.

For instance, PRUMortgage helps pay off your mortgage in case of your untimely death or disability.

Benefits of riders in insurance

Insurance riders offer several advantages, including the following:

Low deductibles

Riders often have lower deductibles than standalone policies, saving you money when you need to make a claim.

Customised coverage

Riders let you customise your insurance plan by adding specific coverage for your unique needs, ensuring you're protected for what matters most.

Extra savings

Adding a rider is typically cheaper than buying a separate policy for the same coverage, maximising your protection while saving money.

How much do insurance riders cost?

The cost of an insurance rider is typically added to the basic policy's premium. The exact cost of insurance riders differs based on factors such as the type of rider, coverage level, age, health, and lifestyle.

Conclusion

Insurance riders are valuable tools that offer extra protection and customisation options for your insurance policy. Check with your insurance provider for the tailored coverage and benefits they provide.