What Is an Insurance Rider?

An insurance rider can add coverage, exclude coverage or modify an insurance policy in some other way. A rider typically expands your existing coverage at an additional cost and is often available for various types of insurance policies, including home, auto and life.

Keep reading to learn how insurance riders work and the different types available.

Key Takeaways An insurance rider is an optional means of changing your existing coverage in your policy, either by adding, modifying or excluding parts of the policy. While riders often increase the cost of your premium, some that add exclusions to your policy may result in a rate reduction. Various types of insurance riders are available for homeowners, renters, auto and life insurance policies. Scheduling high-value personal property, like collectibles and jewelry, through a rider can help increase your coverage limits for those items. The cost of an insurance rider will vary based on type, and not all riders may be available from every insurance provider.

How Do Insurance Policy Riders Work?

Sometimes called endorsements, floaters, amendments or add-ons, insurance policy riders modify your base policy’s coverage. Riders typically come in one of three forms:^[1]

• Additional Coverage: Adds or includes coverage that would otherwise be excluded.
• Exclusions: Excludes coverage for certain types of claims that may otherwise be covered.
• Modification of Coverage: Expands the scope of existing coverage.

Since insurance policies typically don’t cover every scenario, riders allow you to customize your coverage to meet your needs.

For example, riders may allow you to increase coverage limits for specific pieces of personal property by scheduling them. Alternatively, you could add coverage for specific perils, like sewer line backup, that aren’t usually covered by a homeowners policy.

Insurance riders can typically be added or removed at any time during the policy period, but this will likely vary between insurers depending on the policy specifics.^[2] Some riders will remain in effect for the life of your policy, while others may only last for specific term limits.^[1]

Does a Rider Cost More Money?

Purchasing a rider to expand or modify your insurance policy’s coverage typically comes at an additional cost. However, riders that exclude certain coverages may lower the cost of the policy’s premium, as it reduces the risk you have of making a claim.^[1]

Types of Insurance Riders

Riders are sold across all types of insurance policies. Below, we list some common insurance riders in auto, homeowners and life insurance policies.

Car Insurance Riders

Beyond standard auto insurance coverage, your insurance company may also sell the following riders:

Car Insurance Rider	Description
Accident Forgiveness	Helps prevent your premiums from increasing after your first at-fault accident.
Gap Coverage	Protects you if your car is totaled or stolen and its actual value is less than any outstanding loan you still have on it.
Rental Car Reimbursement	Pays for the cost of a rental car if your personal vehicle is left unusable due to a covered accident or loss. Keep in mind there may be limits to how long your insurer will cover you.
Rideshare Coverage	Provides car coverage when you drive for a rideshare service, like Lyft or Uber, which would otherwise require a commercial auto insurance policy.
Roadside Assistance	While sometimes available as a standalone policy, this rider would provide services like towing, fuel delivery and flat tire changes when your car breaks down.

Homeowners Insurance Riders

To further protect your home, you may also want to consider the following riders:

Homeowners Insurance Rider	Description
Ordinance or Law	Helps cover the cost of repairs to your home after it’s damaged or destroyed to keep it up to building code regulations if the costs would otherwise exceed your homeowners coverage limits.
Business Property	Expands coverage to include repairing or replacing business property that’s kept in your home.
Earthquake Coverage	This would protect you against damage caused by earthquakes or tremors. Sometimes available as a standalone policy.
Flood Coverage	This would protect you against damage to your home caused by flooding. Sometimes available as a standalone policy.
Identity Theft Protection	Helps reimburse losses caused by identity theft, including credit monitoring services, legal fees and lost wages, although coverage may vary between insurers.
Scheduled Property Coverage	Covers the cost of repairing or replacing specific pieces of personal property with higher coverage limits than your standard personal property coverage.
Water Backup	Covers the cost of repairing water damage caused when a sewer line or pipe backs up into your home.

Life Insurance Riders

Below are some common riders your life insurance company may offer:

Life Insurance Rider	Description
Accelerated Death Benefit	Also called a terminal illness rider, this allows you to claim some or all of your life insurance payout before dying if you’re diagnosed with a qualifying serious or terminal illness.
Accidental Death and Dismemberment Benefit	Increases the insurance payout if the death or severe injury is caused by a covered accident.
Automatic Premium Loan Provision	If you haven’t paid your premium by the end of the grace period, your premium will be paid out of your death benefit amount. This can help prevent your policy from lapsing and losing your coverage.
Child and Spouse Coverage	Allows for a death benefit to be paid to the insured should a covered child or spouse pass away.
Cost of Living Coverage	This rider increases your policy’s payout over time to match inflation.
Disability Income	Provides monthly income based on your death benefit if a covered accident or illness prevents you from working due to a disability. It may also be available as a standalone policy.
Guaranteed Insurability	Allows you to add increased coverage to your policy without an additional medical exam.
Term Life	Allows you to increase the death benefit of a permanent life insurance policy, but only for a set period.
Waiver of Premium Disability	This rider removes the premium for your life insurance policy if you have a qualifying disability that stops you from earning an income.

When Do You Need an Insurance Rider?

Most insurance riders are optional, so the value of paying more for a rider will depend on your lifestyle and needs. For example, someone wishing to use their vehicle for rideshare services will likely need a rideshare coverage rider to drive legally. Additionally, if you own high-value musical instruments or artwork not covered under standard homeowners insurance, you may want to purchase a rider to cover those items in that case.

What Are the Benefits of Adding an Insurance Rider?

Although insurance riders can increase your insurance premium, there are several benefits worth considering:

• Expanded coverage: Insurance riders can fill gaps in coverage that are otherwise left exposed in a standard home, renters, auto or other type of insurance policy.
• Potential savings: Accidents and disasters can strike when you least expect them. Purchasing additional coverage via insurance riders can help offset the cost of repairing, rebuilding or replacing items after a covered loss.
• Peace of mind: Although insurance riders come at an additional cost, they may offer you peace of mind, knowing you’re protected during covered events.
• Flexibility: Since insurance riders tend to be highly specific, you can purchase riders that tailor your policy to your needs.

How Much Does It Cost To Add a Policy Rider?

The cost of adding a policy rider will vary based on the type of rider. For example, an identity theft rider to your homeowners insurance could cost between $25 and $60 annually.^[3] However, scheduling personal property for your homeowners insurance typically costs between 1% and 2% of the item’s value.^[4] For example, it could cost as much as $100 to schedule a ring valued at $5,000.

Some riders, such as an accelerated death benefit, don’t require an additional cost, instead necessitating you meet qualifying conditions.^[5] Check with your insurance company to see if its offers a specific rider for your needs, alongside potential costs. Keep in mind that not all insurance providers offer every type of rider, so you may need to shop around to find an insurer that offers your desired coverage.

What Items Are Commonly Scheduled on a Rider?

Items commonly scheduled on a home insurance rider may include:

• Jewelry
• Clothing
• Paintings and artwork
• Technology (e.g., cameras, watches, computer equipment)
• Collectibles (e.g., wine, trading cards, stamps, coins)
• Musical instruments
• Firearms