Looking to lock in your rate class?
By Alan Friedman
Safeguard your younger clients’ insurability in the future by offering them a policy with a Guaranteed Insurability Rider (GIR).
While it is true that aging can be associated with certain health changes, not everyone is fortunate to be able to maintain good health and function well as they get older. Many may face a decline in health and experience a number of health issues throughout their lives. We never know what the future has in store. Why take the chance? Lock in today’s health class with a Guaranteed Insurability Rider!
The Guaranteed Insurability Rider (GIR) is an invaluable asset for policyholders seeking to "lock in their insurability." This rider empowers them to acquire additional coverage at predetermined intervals without the burden of new medical requirements or underwriting, irrespective of their health status at that future time. By incorporating this rider into their policy, owners gain the flexibility to increase coverage as their needs evolve, all without the hassle of reapplying for a new policy.
This rider is available through select carriers, with one of our strongest partners boasting an exceptional A.M. Best rating of A++. Our commitment to excellence ensures that your clients have access to top-tier options for securing their financial future.
The comprehensive chart below, from one of our top carriers, shows the specified option dates based on the age when the rider is issued. At each option date, the policyowner will have the ability to purchase additional life insurance up to the amount selected at the time of issue. This can be as much as twice your original policy face amount up to a maximum of $125,000.
OPTION DATES
*Options must be elected within 30 days of policy anniversary date.
*The insured may accelerate an option for marriage or becoming a parent.
As you can see, this rider is particularly advantageous for younger insureds. For those under the age of 25, the rider allows for potential coverage increase up to a total of $1 million.
Case Study: Grandparents purchase a $100,000 Whole Life policy for their 3 year old grandson.
Initial Coverage Information
Total Initial Death Benefit: $100,000.00
Initial Premium Information
Premium Payment Mode: Monthly
Base Premium: $94.40
Guaranteed Insurability Rider (GIR) Premium: $5.66
Waiver of Premium (WP) Premium: $4.52
Total Initial Premium: $104.58
The GIR Rider included in the above premium is for the maximum amount of additional coverage available: $125,000. Based on the insured age, there are eight distinct opportunities afforded to augment coverage by an additional $125,000 at each instance. Should the insured seize all available opportunities, the ultimate result would be an accumulation of an additional $1,000,000 in coverage, superimposed upon the original $100,000 base. It is important to note that while the GIR Rider presents invaluable options, opting for increased coverage entails a higher premium. The cost of the additional coverage is linked to the insured's age at the time of each increase.
Another valuable rider in this example is the Waiver of Premium Rider. This allows the insured to increase his coverage even if he is totally disabled. In this situation, the premiums for both the base policy and the GIR will be waived. If premiums are being waived at the time of an option date, coverage can still be increased at no cost. In this situation, the premium for the additional coverage purchased will also be waived. This is an unparalleled financial safeguard for the insured in times of need.