On Insurance Riders

Insurance plans are often like an ice-cream purchase. First, you choose the basic plan. But then there is usually an entire slew of options, riders and tweaks waiting for you to debate and decide upon. These are there to let you improve your plan and cover your individual risks in a kind of “pay per service” way. Some policy riders are more often applied than others, but some are also much more compelling than one may think.

RBC Insurance, for example, offers a Business Insurance Option, which is basically akin to the Future Income Option under its disability policies.

Business Insurance Option is a reasonably priced rider on Disability Insurance policies permits the the insured(s) to top up a higher level of protection should the business grow in the years to come.

Business Tower, Nuremberg
Credit: http://www.flickr.com/photos/dirtyhacker/

Business Insurance Option

Business Insurance Option is really a defence of your insurability when your health deteriorates but the business grows. An example of this: one of the business partners discovered a health problem, like hypertension but their organization rose in efficiency. Purchasing additional coverage later on could easily be a problem in a routine case. However, thanks to the Business Insurance Option, the business owner may enhance their personal income protection at each “option date”, which means every second plan anniversary date.

  • Additional insurance coverage can be augmented by as much as eighteen per cent of the limit option amount that is available..
  • The client is required to provide a proof of their insurability. This is really evidence of an business income increase. Medical examination is, however, not required any any more, which is why this rider could be very advantageous.
  • When the client exercises this rider, the added fee is determined taking into consideration their current age, not his or her original application age.
  • The terms and coverage type of the additional income coverage are just the same as those of the basic plan.

Additional Resources

Learn more about little-known policy options and riders. Stay updated about the latest insurance-related news, please visit Lorne Marr's insurance website.

Prepared by Lorne Marr, an independent insurance broker and an expert on special insurance arrangements. Lorne has worked in this business for nearly two decades. His LSM Insurance brokerage firm works with more than 12 Canadian companies, such as Sun Life or Manulife.