What is a spouse rider beneficiary?

In insurance lingo, a rider is an add-on policy. Riders can accomplish many different uses, modifying or extending the coverage outlined in the policy. One popular life insurance rider is the spouse rider, because it effectively turns an individual life insurance policy into coverage for two.

With a life insurance spousal rider, you and your wife share the same policy. This is essentially the same as a joint first-to-die policy, where the first of the partners to pass away triggers the policy, which then pays out according to the terms of the policy. This is an effective way to make sure that your spouse will be cared for if you die, and is especially useful in a household where both partners are part of the income earning workforce.

Another type of life insurance rider is the last-to-die rider. This transforms the policy, as with a spousal rider, into a joint policy for both partners. The difference is that this type of rider means the policy ignores the first partner's death but pays out when the other partner passes away. This rider is sometimes called a second-to-die rider.

A spouse rider can be very helpful in a situation where one or both partners require long-term care. The policy can be purchased to pay out in this event, so that your death would trigger the policy to assume medical costs and other expenses of the surviving partner, either for a specific number of years or until the face value of the policy is exhausted.

Before you buy a whole life insurance policy, look at the different riders available. As with a spouse rider, you can find riders that make your life insurance policy more effective, that save you money, and to address other concerns, such as a long term care rider that can be added to the policy along with the spouse rider, giving you the best protection if one of you dies and the other is left permanently injured.