When you buy life insurance, you'll often have the option of adding a variety of policy riders (optional coverage enhancements) to your policy. You can customize your life insurance policy by adding riders or specific endorsements to enhance the policy to fit your specific needs. This article discusses a few common policy riders, some of which Protective does not offer. And while not every life insurance rider may be right for you, one rider you may want to consider is the guaranteed insurability rider.
The guaranteed insurability rider ensures that you will be able to buy larger amounts of insurance in the future as your need for coverage increases. 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, or worse, make you uninsurable. So if you need additional life insurance in the future (such as with a new marriage or birth/adoption of a child) a guaranteed insurability rider will ensure that you have the option to cover your needs.
Generally, you will only be allowed 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.
The typical guaranteed insurability rider lets you purchase insurance every three or five years on the anniversary date of your original policy. Many policies will also allow you to exercise your option up to 90 days in advance of a marriage or birth/adoption of a child. Generally, you must exercise the right within 30 or 90 days of the specified date for this reason, it's important to check your policy and review your option dates. After the specified period, the advance purchase privilege expires. If the insured does not exercise the advance purchase privilege, then the guaranteed purchase option cannot be exercised until the following exercise date.
Often, for a very nominal additional cost, a guaranteed insurability rider could give you the assurance to increase your coverage as your needs for insurance change.