Riders are added covers, available on an
optional basis with most of the insurance products, which protect you
against risks. They help you to buy additional cover at a nominal cost.
Generally, this cost is low because relatively little underwriting is
required. Based on your eligibility and need for protection, they can be
mixed and matched.
When you avail of a simple
insurance policy and then add a rider to it, you get additional benefits
attached to your policy. Riders help you increase your insurance cover
quality and quantity wise. A rider is generally like a mini-insurance
policy that is added to your insurance policy because there are chances
your original insurance policy might not cover everything, and
therefore, you may need additional protection.
Sometimes the basic life insurance
policy is not enough to protect you from unexpected expenses like
accident and illness. In that case you have to prepare yourself by
adding riders. The most common life insurance riders are money back,
critical illness, accident benefits, disability riders, waiver of
Premium, child Term and terminal illness benefits.
With health insurance riders flooding
the market, it is important to choose the right one for essential
benefits. Say, hospital cash, patient care, new born baby care, critical
illness benefit, E-opinion rider, etc. The health insurance riders may
also act as special exceptions to coverage in health insurance plans put
in by insurance co.s. Let's say you injured your knee once and had
surgery. The underwriters at the insurance company in this case may
decide to place a rider on the knee meaning they will cover you for
everything EXCEPT for your knee, because they believe they could lose
money due to your knee problem. These riders/waivers are sometimes
permanent, while other times it may be issued as a two-year, three-year
or five-year rider. If the condition does not deteriorate or recur over a
period of time, often the insurer will "lift" the rider and give you
full coverage.
Home Insurance riders provide better
protection and maximum coverage for all your belongings, covering even
those items which aren't ideally covered under a home insurance policy.
For e.g. for covering your personal possessions, electronic equipments,
any additional property that you might have, to cover damage due to a
backed up sewer or drain and even a business based home insurance rider.
Auto Insurance Rider, an endorsement,
change, or addendum to adjust your car insurance policy by actually
deleting potentially unneeded coverage and adding the required ones,
will help increase coverage protection and decrease your yearly premium
for insurance. For e.g. Waiver of Depreciation rider, Loss of Use rider, Accident Forgiveness rider, Family Protection Coverage rider, etc.
The option of using "riders" is good for
the insurance companies as well as for the general public because it
enables the companies to insure people/products whom/which they would
otherwise decline to cover. When a claim for the benefits of a rider is
made, it can result in the termination of the rider, while the original
policy continues to insure you as usual. Note that the insurance
coverage, premium rates, terms and conditions of riders differ from one
insurer to another. Since riders empower you with much-needed control
over your ever-changing life situations, it is imperative that you sit
down with your insurance broker to evaluate the benefits of the rider
and buy the one that is best-fitted for you and your family before
taking out an insurance policy.
read this related article :