Riders attached to disability income policies can greatly expand the policy coverage. Social Insurance Benefit riders can be added to increase the overall coverage while still enabling the insurer to avoid the problems associated with overinsurance in the event Social Security benefits are payable. Available as supplements and substitutes, Social Insurance Benefits also permit policyowners to reduce the premiums for needed coverage.

Purchase Option and COLA riders both help to overcome the tendency of benefits to become less significant over time. The Purchase Option Rider enables an insured to purchase additional coverage while COLA riders increase benefits while on disability. Return of Premium riders offer disability income policyowners the opportunity to recover some or all of their disability income policy premiums.

The correct answer to each question is shown in green. Click any question to review the relevant section of the study text.
Review Questions
Social Insurance Substitute rider
Social Insurance Supplement rider
Both a and b
Neither a nor b
The total disability benefit provision
The residual disability benefit provision
Both a and b
Neither a nor b
Its premiums are considered unnecessarily high
Premiums are returned too infrequently
They may inhibit the submission of claims
The provisions are too complex for many policyowners to understand
Upon policy surrender
At the insured’s death
At the insured’s age 65
Upon the insured’s disability