What is a rider in insurance?
An insurance rider, also known as an insurance endorsement, is an optional add-on to an insurance policy that typically adds, deletes, or excludes coverage or in some way changes the terms of the policy. For example, riders can:
Increase your coverage limits.
Expand coverage for certain properties.
Extend protection to help cover additional perils.
This article focuses on insurance riders that can be added to home insurance, but you can add riders to other types of insurance, including rental, auto, and life insurance.
How an insurance rider works
Your insurance policy is a contract between you and your insurer. Essentially, an insurance rider is an amendment to your existing insurance contract that changes the terms of the original policy.
When you have specific needs not covered by a standard insurance policy, you can sometimes add a rider to customize your policy for your situation. You can usually get a rider when you purchase your policy or at any time during the policy term. The policy premiums may change based on the changes outlined in the rider.
Riders can be added to home, renters, and auto insurance. Typically, a rider changes the original policy in one of the following ways:
Add or include coverage that would otherwise be excluded
Exclude coverage for certain types of claims
Modify coverage by expanding or changing the scope of the original policy
Types of home insurance riders
People often get riders to get coverage for things their policies typically exclude. We’ve listed a few popular types of home insurance riders below.
Scheduled personal property rider
Home insurance does include personal property coverage, but some people find the standard amount isn’t enough to protect their valuables. That’s where a scheduled personal property endorsement comes in. It can cover your valuable items—like jewelry, fine art, antiques, or a coin collection--up to their appraised price. Some even protect these high-value itmes against additional risks that a standard homeowners policy doesn’t cover, like loss or misplacement.
Water backup and sump pump overflow rider
A standard homeowners policy typically excludes water damage from a water backup or sump pump overflow. A water backup and sump pump overflow rider can be added to your homeowners insurance to help pay for damage caused by backed-up sewers, drains, and sump pumps.
Golf cart coverage rider
Home insurance policies don’t usually cover property damage or bodily injury you cause while using your golf cart, so a golf cart insurance rider may be an important protection for you. Some golf cart riders also cover damage to the golf cart itself.
Roof surfacing payment schedule rider
Most insurance companies either refuse to insure homes with older roofs or price the policy so high that it’s cost prohibitive. In exchange for a lower premium, a roof surfacing payment schedule rider subtracts your roof’s depreciation from your claim settlement for wind or hail damage. Roof depreciation is based on its age and surface materials.
Flood insurance rider
Few home policies cover flood damage, and that can be a serious exposure for most homeowners. One option is to get a standalone flood insurance policy from the federally backed National Flood Insurance Program (NFIP). But you might want to take a look at our flood insurance that can be purchased as a policy rider.
What are the benefits of an insurance rider?
Insurance riders allow policyholders to tailor coverage to their needs. For example, you might need additional personal property coverage for valuable items or flood insurance if you live in an area with a higher risk for flooding.
A rider can provide increased coverage where you need it, typically at a lower cost than buying a separate policy.
How much does an insurance rider cost?
Depending on how the rider amends your policy, it can increase, decrease, or have no impact on the cost of your policy.
An endorsement that does something as simple as changing the mortgagee on your policy doesn’t alter your premium. But if you add personal property coverage, flood insurance, or make any other changes that increase the coverage provided by the basic policy, you can expect your premium to increase.
Likewise, any endorsement that decreases your coverage often lowers your premium.
How to add an insurance rider
Your insurance representative typically asks about additional coverage you might need when you purchase your policy. At that time, you can discuss any riders you might need to tailor your coverage appropriately. If you’re adding coverage for high-value items, you’ll likely need to provide an appraisal as proof of each item’s value.
If your coverage needs to change during the policy period, you can add a rider at any time or at policy renewal time. Simply contact your insurance company representative to discuss your options.