Last Updated on November 15, 2024
Customized terms added on top of an existing life insurance policy are known as life insurance riders. These riders are typically used to customize coverage to better fit your future financial needs like allocating funds for children’s college education. Although some life insurance riders don’t cost extra (such as a term conversion rider), most will likely increase the cost of your policy.
Even though life insurance riders cost you an extra amount, they can be worth it because they help make your policy work better for you in terms of saving money, protecting you against medical costs and illnesses in the future and even serving as retirement funds.
Many people with Diabetes feel that they may not qualify for life insurance, and will be declined. Most of the time, this is not true. The majority of diabetics will be approved for life insurance coverage, and many will even have the option to obtain ‘riders’ that enhance their policy.
Please contact us to see what policies you’ll qualify for, and to learn about the riders best suited for you. We love working with the Diabetes community, and helping those within it find the best possible life insurance policy. In the meantime, we’ve covered some of the most common options to give you an idea about how they work.
Quick Article Guide
Here’s what we’ll cover in this post:
Accelerated Death Benefit Riders
One of the most important types of riders a person should consider is an accelerated death benefit rider. Not all insurance providers will offer these, especially to a person with Diabetes. Accelerated death benefit riders may be broken down using 3 specific riders. Please see as follows:
- Critical Illness Rider
- Terminal Illness Rider
- Chronic Illness Rider
In the event a person is diagnosed with a significant health issue, the policy holder could accelerate part of the death benefit while living. Any amount you receive, will offset the death benefit of the policy.
Since we are a diabetes insurance specialist, we’ll be able to help you find the policies that offer these benefits. And best of all, certain life insurance providers offer these additional benefits at NO EXTRA cost.
Child and family life insurance riders
If you have any dependents like a spouse, old parents or children, then a family rider will help protect their financial situation should something unfortunate happen to you in the future.
Consider getting a family rider especially if you’re the sole breadwinner in the family. It can provide immense financial help in covering childcare, household and medical expenses and even cover mortgage in your absence.
A spousal rider provides you a death benefit in the event that your spouse passes away. This amount can be used to take care of the end-of-life expenses and funeral costs so you can take time off to grieve the loss. A child insurance rider works similarly to cover costs if your child were to pass away.
Terminal illness insurance rider
According to Fidelity Life, a terminal illness rider “is a supplemental life insurance product that gives you early access to your death benefit if you’re diagnosed with a terminal illness. If you’re given a short time to live, an accelerated benefit for terminal illness rider pays out a portion of your life insurance policy while you’re still living”
Even for people with Diabetes, most companies are now offering this rider without any cost to the policy holder. Being a free ‘added benefit’, it’s a wise decision to have this rider on your policy. We never know what the future holds, and having access to your death benefit while having a terminal illness may be of value to your family.
Critical illness insurance rider
This is also known as an accelerated benefit rider. It essentially takes money out of your death benefit while you’re still alive to cover the cost of medical treatments in case you’re diagnosed with certain critical illnesses. These typically include heart attack, stroke, kidney failure and cancer.
Upon your death, your beneficiary will receive the remaining amount of the death benefit that was not used to take care of your medical expenses. Many clients prefer to have policies that have flexibility in how the death benefit can be accessed, while living. This Critical illness rider is extremely important for many families.
Chronic illness rider
The chronic illness rider is another important rider to consider. In summary, if you cannot perform at least two of the six activities of daily living, you could accelerate a portion of your policy’s death benefit while still living. Activities of daily living include Eating, Dressing, Bathing, Continence, using the bathroom on your own, and being able to stand/walk/sit on your own.
Fortunately, certain life insurance providers will offer this rider to a person with Diabetes. In some situations, premiums would not be increased to have this rider added to the policy.
Charitable giving rider
This rider provides you with the option of selecting a charitable non-profit organization as one of the beneficiaries in your term life insurance. Upon your death, the organization will be entitled to the death benefit if they apply for a claim with the insurance company.
One company who we love working with, Foresters Financial, will offer this with no fees. For the right person, this rider would be of great use to a Charity of your choice.
Guaranteed insurability rider
If you want to increase your financial coverage in the future, a guaranteed insurability rider will ensure that you’re able to update your existing policy. This can be a huge cost saver when compared to buying a new policy from scratch as that would involve spending more for the policy as well as going through the qualification process all over again. At a later age, you will likely have to pay a much higher premium. Worse, you may not even qualify for another life insurance policy due to medical conditions that you may acquire over time.
A guaranteed insurability rider is a popular option especially among people who plan to have a family in the future. It provides flexibility and adjusts to lifestyle changes later in life while keeping the premium costs at the same low rates available initially.
Waiver of premium rider
This rider provides you the advantage of covering your premiums in the event that you’re unable to pay them under certain conditions. If you are temporarily disabled due to a medical condition or injury, the waiver of premium rider pays out the premiums due for the period during which you’re unable to work.
Usually the waiver of premium riders is only a few dollars more per month to add. For lot’s of younger consumers, a rider like this would make a lot of financial sense. Sadly, many agents and other websites don’t thoroughly go over what options consumers have, and not share options like this with them. In our opinion, this type of rider is worth exploring.
Return of premium rider
This type of rider is one of the most common riders as it refunds the premiums you paid through the term of your policy once you outlive it. It can usually be added on top of term life insurances which have a term of 15 to 30 years. If you don’t use the coverage, you could even receive a full refund of all the premiums you’ve paid.
However, the additional cost of a return of premium rider often outweighs the potential future benefits you receive beyond the policy term. For this reason, it’s not always the affordable choice for everyone. But for the right person, a return of premium rider may make financial sense.
Long term care rider
A long term care rider covers your monthly expenses if you need home care and nursing facilities in the future. You can add this rider on top of your existing policy or even consider buying it separately as coverage of its own. This is a great option to cover your retirement years to ensure that you can afford the necessary help and care should you need it.
We’ll quickly point out that NOT every person with Diabetes will be eligible for this rider. Depending on age of Diabetes onset, control of your Diabetes, and overall health profile, a few life insurance carriers will offer this. However, this is done on a case by case basis.
AD&D or Accidental death and dismemberment rider
This type of a rider is beneficial for those who have careers with high risk or enjoy high-risk adventure activities like skydiving or scuba diving. It pays a part or all of the death benefit in the case of injury caused by an accident. In the event of death, the policy pays out to the beneficiaries.
An AD&D rider is generally more expensive and less popular since it comes with strict requirements around the cause of death. Generally, we may recommend taking out a separate AD&D policy as these riders may not always be the best.
Do you need life insurance riders?
Life insurance riders can be incredibly useful as they can help your policy adjust better to your financial plans for the future. On the flip side, they can also be an unnecessary added expense and a total waste of money.
Do consider getting life insurance riders if you’re into high-risk jobs or if you plan to have children in the future or even if you have medical complications in your family history. These riders can help you and your family stay financially protected against life’s uncertainties.
On the other hand, if you don’t have any dependents or future plans to start a family, or have more pressing financial needs in the present, such as paying high-interest debts, life insurance riders may not be the best option for you. You may want to opt for the lowest priced life insurance policy.
Whether getting life insurance riders make sense for you or not, and if they do, which to opt for – this depends on your personal financial situation and lifestyle. It’s best to talk to an agent to weigh the odds against your income as well as financial goals and plans.
What’s best about some of these specific riders is they can be added to term life insurance and whole life insurance products. Since everyone’s financial situation is different, it’s nice to know that most type 1 and type 2 diabetics can customize their policies to make sure their family’s are well protected.
Looking to customize your life insurance policy in the most affordable way?
At Diabetes 365, we have a team of qualified and licensed agents who will provide you with the best options available when it comes to life insurance riders. Whatever your budget, financial goals and plans, we’ll find the best riders to keep you financially covered at the most reasonable costs. Bottom line is nobody is better than us at finding people with Diabetes the best life insurance policies.
Everyone has different financial needs, and health profiles. Because of this, it can be a little challenging determining what life insurance options people with Diabetes have. Or what riders their health profile will qualify for. This is why we created this online resource, to help people like you.
Please simply complete a quote request, or contact us today. A licensed agent will ask you a few questions about your Diabetes history, and then will be able to provide you with some accurate information. We’ve helped over 100,000 people with Diabetes find affordable coverage. Let us do the same for you and your family.
