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Quick Guide to Life Insurance Riders

By itself, a group life insurance policy is somewhat of a one-trick pony: The insured enrolls in coverage and their designated beneficiaries receive a death benefit when they pass away. However, adding extra benefits and features (known as riders) to a whole or term life policy can expand that coverage, giving insureds more options while keeping their discounted group premium at an affordable level.

In recent years, interest in life insurance has increased among all working generations. This is most notable among millennial workers, who are now having families of their own and planning for the uncertainties of the future.

Percentage of employees seeking employer-sponsored life insurance, by generation.1
Gen Z Millennial Gen X Baby Boomer
40% 53% 51% 42%

Because of this growing interest, especially among generations that now dominate the American workforce, employers have an excellent opportunity to enhance the life insurance coverage they offer. Adding riders to a group life policy can meet the increased interest and encourage higher enrollment among employees.

There are several types of life insurance riders available in the market. Here are some of the more popular options.

Accelerated death benefit riders

Life insurance typically pays a benefit when the policyholder dies, but in the meantime, life often includes bumps in the road. People may experience serious injuries or life-changing illnesses along the way, both of which can be expensive.

An accelerated death benefit (ADB) rider offers the policyholder the opportunity to access a portion of the life policy's death benefit (what their beneficiaries would receive after their passing) should they become sick or injured. The benefit can help them pay for treatment-related costs like deductibles, copays, or other expenses.

Depending on the carrier, ADB riders may be offered for chronic illness (being incapacitated or disabled for an extended period), critical illness (being diagnosed with a major condition), or terminal illness (being diagnosed with a condition that will be fatal within a specified time, such as six months).*

Accelerated death benefit for long-term care riders

ADB riders may also include long-term care riders, which are growing in popularity. These add-ons offer the opportunity to access some of the death benefit for a specific period of time if the covered person is diagnosed as chronically ill and requires long-term care services to assist with daily activities such as bathing or moving around.

Depending on the carrier, options may also be available to extend the period of time that benefits are payable under this rider or even restore the death benefit to the original amount afterward.

Two fathers holding hands of their son while walking.

Children's and spouse's term insurance riders

While a permanent life policy pays a benefit when the primary insured dies, it is common for group policies to offer term insurance as a rider for spouses and dependent children. Typically, a children's term rider will cover kids up to age 25 and includes one flat premium for all children who are covered by the rider.

As with any term insurance policy, the term life rider pays a benefit if the covered spouse or child passes away while the policy is in force.

Payor waiver of premium riders

Disability often prevents employees from working and making a living wage. Therefore, carriers may offer a payor waiver of premium rider, which relieves the insured of having to pay their premium when the carrier receives proof that they have been certified as disabled. Typically, there is an elimination period (waiting period) for the rider to be payable after the disability occurs, such as six months.

Accidental death benefit riders

While adults are more likely to die from illnesses, accidental injuries are the fourth leading cause of death in the U.S.2 An accidental death benefit rider increases the death benefit if the policyholder dies as a result of an accident.

When an employer adds this rider to their group's life insurance policy, they are helping to provide extra support to the insured's family should the unthinkable happen.

Life Insurance from Allstate Benefits

Life insurance can be a meaningful way to help ensure a financially secure future for employees and their families. By adding life insurance riders to a group life insurance policy, employers can encourage employee participation and add extra protection against life's many uncertainties.

There are several types of affordable group life insurance solutions that employers can provide to employees. Learn more by reading "Which Type of Life Insurance is Best for Your Employees?"

Allstate Benefits offers a broad selection of group life insurance solutions.

12023 Workforce Benefits Study, LIMRA

2Accidents or Unintentional Injuries | Centers for Disease Control and Prevention

*Definitions may vary by carrier, product and state.

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