Rhode Island Life Insurance Practice Exam

Which rider provides coverage specifically for a child under a parent's life insurance policy?

1. Family Rider

2. Child Term Rider

3. Dependent Rider

4. Additional Insured Rider

The correct answer is: Child Term Rider

The Child Term Rider is a specific addition to a life insurance policy that provides coverage for a child under the parent's policy. This rider ensures that in the event of the child's death, a predetermined death benefit will be paid out to the policyholder. This coverage typically extends to all eligible children and can be added at a nominal cost to the overall premium of the life insurance policy. The significance of this rider lies in its ability to simplify the process of obtaining life insurance for children, as it often does not require additional underwriting and provides necessary financial support in a tragic situation. The coverage is activated for a defined period, usually until the child reaches a certain age, at which point the child may have the option to convert the term coverage into a permanent policy without the need for medical underwriting. In contrast, the Family Rider generally covers additional family members but does so in a manner that may not be specifically tailored for children. The Dependent Rider is also designed to provide coverage for dependents but might not focus solely on children. The Additional Insured Rider can add coverage for other individuals but is not primarily aimed at providing coverage specifically for children under a parent's life insurance policy.