Open an insurance proposal and there is a long list underneath the main contract. Those are riders, and they determine what your policy can look after beyond life cover. Here is how they work.

What a rider is

A rider is supplementary cover attached to a main life insurance policy, extending it to other matters such as medical expenses, critical illness or accidents, for an additional premium on top of the main contract according to what you select. The essential point is that a rider exists by virtue of the main contract: if the main contract ends, the riders end with it.

Common riders

  • Medical expenses — covering the costs of a hospital admission.
  • Critical illness — paying a lump sum on diagnosis of a listed condition.
  • Accident — additional cover for death or disability from an accident.
  • Income replacement — paying a daily amount while in hospital.
  • Waiver of premium — on total permanent disability under the conditions, premiums stop but the cover continues.

Each company's list and conditions differ, and the names may not match. Look at the substance of the cover rather than the label.

What to know before attaching one

Most riders are renewed year by year, with premiums adjusting by age and renewal subject to the stated conditions — unlike the main contract, whose premium is usually level. Health-related riders also have waiting periods and exclusions of their own, so read their conditions separately from the main contract.

How to choose

Choose according to the risk that would hit your finances hardest first — for most people, a large medical bill. There is no need to attach every one, because the total premium then becomes hard to sustain over the long term. The better approach is to set your priorities and leave budget to review and add more as your income grows.

In short

Riders are the tools that tailor a policy to your life. Take only what you need, understand each one's conditions, and review whenever life changes. If you are not sure which are necessary for you, talk it through with your agent, describing your obligations and the benefits you already have.