Your life insurance policy will pay a fixed benefit to your beneficiaries when you die. This benefit is determined when you buy the policy. You can add more benefits to your life insurance policy but you will have to pay more. These additions are generally called riders. Some of them are well worth the extra money you pay.
The most common rider is the waiver of premium. For a very small fee, usually a few cents per $1000 of life insurance, you can purchase a waiver of premium rider which will become part of your life insurance policy. It is a type of disability insurance added to your life insurance. If your life insurance policy has a waiver of premium rider, if you become disabled before a certain age and the disability lasts longer than six months, then the insurance company will waive the premiums. You don’t have to pay the premium but your coverage will continue for the term of your policy as if you never missed a payment. Generally this waiver is retroactive to the beginning of the disability. Any premiums made during the disability are usually refunded. When the disability ends, you continue to make the premium payments as if nothing ever happened. There is no requirement to pay the dividends that were not paid during the disability period. You are considered disabled if you are not able to perform the regular and normal duties of your job. Sometimes this rider comes with a tied provision disability insurance income. The life insurance company will waive the premiums on your life insurance policy, and it will also pay your normal, monthly income as if you were working. Another popular rider is the accidental death benefit rider also referred to as the double indemnity clause. If you add a double indemnity rider, the life insurance company will pay to your beneficiary twice the face amount of your policy if die in an accident. You can also add a triple indemnity rider for certain life insurance policies and the insurance company will pay thrice the amount if you die in an accident. . If you had a triple indemnity rider, the amount would be thrice the face amount.
You can also add the critical illness cover. If you are unable to work because of a critical illness, a part of the maturity amount to be distributed to you in a lump sum. Some insurance companies will also make a regular payment to mirror former income. With accelerated death benefits, you can collect the benefits if you are diagnosed with a terminal illness. The permanent total disability rider provides for additional insurance benefits if you suffer permanent total disability as a result of an accident or illness.
