How Do Riders In Child Insurance Plan Works
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Child riders, also referred to as child insurance riders or child term riders, allow you to enhance a term life insurance policy that you’ve taken out to cover yourself or your spouse. This type of rider covers all of your children as well as any children you may have in the future.
If your child passes away, your policy’s child rider would allow you to collect a death benefit. You could then use this money to cover funeral and burial expenses or other costs. Depending on how your policy is structured, a child rider may be convertible to permanent life insurance coverage.
How Child Rider Life Insurance Works
Typically, the option to purchase a child rider is offered at the time you purchase a new life insurance policy. Some insurance companies may allow you to add a child rider to an existing policy, though this isn’t always the case.
Most child riders work by covering children from infancy up to age 18, though some policies may extend coverage up to the child’s 25th birthday. You pay an additional premium for the rider which covers all of your children. The cost varies based on the insurer, but it may be less than $5 per month, depending on the size of the death benefit.
The insurance company may require you to be within a certain age range to qualify for a child rider for life insurance. For example, you might need to be at least 20 but younger than 55 to qualify. You may need to answer a health questionnaire about your children, though a medical exam usually isn’t necessary. Keep in mind that pre-existing conditions may not be covered.
In the event that you never need to use the death benefit, your child may have the option to convert a term rider into permanent life insurance for themselves. The policy would then remain active as long as the premiums are paid.
Who Needs a Child Rider for Life Insurance?
You might consider purchasing a child rider for your life insurance policy if you want to enhance your coverage in the face of a worst-case scenario. The loss of a child can be emotionally devastating and a child rider can ease some of the financial burden of paying for funeral or burial arrangements.
Child riders cover your children based on their health status at the time the policy is purchased. So if they develop a life-threatening condition later, you already have this coverage in place. You may also consider a child rider if you’d like your child to be able to convert it to permanent life insurance later.
Convertibility can be an attractive feature of child riders because they ensure that you get some value out of the coverage. Ideally, you never have to use the rider’s death benefit. And if your child can convert the policy later then the premiums you’ve paid up to that point haven’t gone to waste.
Conclusion
A child rider for life insurance could make sense in certain situations, but it’s important to understand what you’re getting for the money. Researching the death benefit amount, coverage limitations or restrictions, premiums and whether the rider might be convertible later can help you to decide if a child term rider is right for you.
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