When you buy a life insurance policy, it's important to get the right amount of coverage. The fact is, buying too little life insurance can leave your loved ones in a tough financial spot. But what are your life insurance options if you can't buy the coverage you need? One way is with an additional purchase life insurance option, or guaranteed insurability rider.
What is a guaranteed insurability rider?
If you are unable to afford the amount of life insurance that you need today, the guaranteed insurability rider is a life insurance option that'll allow you to purchase additional life insurance at a later date - without a medical exam to prove your insurability. Why is this important? Because you never know how your health or life may change. For example, a prolonged illness or sudden disability in the future could substantially increase your life insurance rates for additional coverage, or worse, make you uninsurable. And then there's certain events such marriage or the birth/adoption of a child that often require the need for additional life insurance.
What you need to know about this life insurance option
When you buy a life insurance policy, it's important to discuss with your agent or company representative the various types of life insurance riders that may be available to you. Why? Because most policy riders can only be added onto your policy at the time it is written. And yes, the guaranteed insurability rider is typically one of those life insurance options.
In addition, this rider will only allow you to purchase additional life insurance at specified times or for certain life events - called option dates. That means that you would be limited as to when and how often you can opt to buy more life insurance. You would also be limited as to how much life insurance you can purchase at that time, depending on your policy. Keep in mind that you may be able to buy the full option amount, a portion, or even none at all. However, you generally can't add option amounts to another date if you decide not to buy the additional coverage.
For additional cost, you can customize your life insurance policy by adding riders or specific endorsements to enhance the policy to fit your specific needs. If you want to learn more about life insurance options and life insurance policy riders, read more about this topic in the Protective Learning Center.