Policy Rider Examples
Here are some examples of insurance policy riders.
Keep in mind insurance companies often have their own unique names for the same type of riders so as to distinguish themselves in the market place.
An advisor who has years of experience and works independently for the clients best interest can help a client determine what would be the best fit for their needs.Sadly,most banks and brokerage firms severely limit the number and quality of products that their employees can offer.
Lifetime Income Benefit Rider:
This rider can guarantee a client that their funds will be compounded at a guaranteed interest rate of 5 to 7 percent per year for five to twenty years for the purpose of determining a guaranteed income for life. This type of rider does not require losing control of the lump sum meaning a lump sum is available to the beneficiaries.
Be careful the inferior clone of this rider will guarantee a lifetime income but requires annuitization,i.e. trading your lump sum to an insurance company for a pension.
LTC Income Doubler for Longterm Care Rider:
When combined with a lifetime income benefit rider this can double income if long term care is needed. In other words if income is guaranteed at $50,000 per year for life, then if a long term care stay occured then income could double to $100,000 per year for five years. Amazingly we have companies that will issue this regardless of how bad a person's health is currently as long as they are not in a facility now.
Return of Premium Rider:
Let's say you want to take an annuity for a test drive for 24 months and then have the option to walk away and get all your money back. You can. This is what other advisers may not want to tell you about these products . We will.
Up Front Bonuses:
Not a rider but these range from 3 to 10 percent. Is this free money? Sort of. The catch is typically the bigger the bonus the longer the term of the annuity. Regardless of the term ten percent free withdrawals are available.
Waiver of Surrender Charge Riders:
Insurance companies are offering powerful guarantees, in return they want to know that you will keep the annuity open long enough to make a profit. If you surrender early you can run into a penalty. The waiver will say in event of death or illness or long term care the annuity can become totally liquid money, without a surrender charge.