A. Accelerated death benefit rider: Pays a portion of the death benefit to the insured upon diagnosis of a terminal illness that will significantly shorten life expectancy.
Many insurers have rolled policy riders right into the policy itself as an added feature, but they've become enticements that sweeten the deal. The StanCorp Financial Group, for example, offers a guaranteed renewable product. Premiums are locked in, and the renewable aspect reduces the price to consumers by 20 percent. There's also a non-cancellable rider, and a catastrophic product that doubles the payout for a disability event that also fits within a long-term care situation. Steve Brady, StanCorp's second VP of individual disability insurance sales and marketing, believes the disability market is an untapped resource for agents. Brady suggests using a permanent life insurance product or an annuity and building disability into it to bring back all premium benefits at age 65.
The world of annuities
Probably the most attractive, complex product for consumers is the annuity policy rider. Despite the word "rider" in its description, some of these are stand-alone products. While many annuity riders do attach to an underlying annuity product, several serve as separate contracts. Consumers can now purchase long-term care, fixed income or variable income riders. Moreover, within the fixed and variable income choices are other options -- deferred payment or immediate payout plans.
Agents as financial advisors?
The question is: are agents ready? Gary Baker, head of U.S. operations and president of CANNEX U.S., an annuity data tracking company, cautions that fixed and variable annuity sales may not be within the bailiwick of many agents. It would depend, he says, on the agent's specialty, career level and training in handling such products.