Riders, Endorsements – What’s the Difference?

If you’ve ever needed to make a change to your insurance policy or done research into adding coverage, you may have heard the terms Rider and/or Endorsement and wondered, What is the Difference?

In this post we’ll explain and hopefully you’ll feel better informed when it comes to your insurance policies.

An Endorsement is a request to change, decrease or add coverage to a policy and is mostly used for Property and Casualty policies (auto/home/renters/etc.), whereas a Rider is a type of coverage attached to a policy for a limited term (time) and mostly on Life policies. EX: Accidental Death rider, Child Term Rider, Spouse Term Rider, etc.

In many instances, an endorsement is used to add a rider to a policy.

Clear as mud?

An easier way to think of a ‘rider’ is as a temporary addition to an insurance policy which can be added or removed that does not change the original benefits stated in a policy.

An Endorsement however, changes the actual coverage(s) listed on the policy. EX: adding an addition onto your home and endorsing the policy to include this addition increases the dwelling coverage of the home policy.

Both result in additional premiums.

Below are a few examples of Riders/Endorsements to a P&C policy….

Auto:
Rental Reimbursement: Reimburses or pays for a rental car while your vehicle is being repaired due to a covered loss.

Roadside Assistance: Flat tire, mechanical breakdown, towing, etc.

Medical Payments: Pays flat amount per vehicle occupant in a covered accident.

Un-Insured Motorists: Protects you and/or your vehicle in the instance of an accident with an un-insured or under-insured vehicle.

These are all riders on an auto policy because they can be added or removed without changing the basic policy (other than increasing/decreasing the premium). For more information read our post, Understanding "Full Coverage" Auto Insurance.

Home/Mobile Home/General Property Liability:

Scheduled Personal Property Rider: Most home policies offer limited coverage for jewelry, art, coin collections and firearms. Adding a SPP rider will increase your coverage on these (and other) items.

Home Business Rider: Adds coverage for home based businesses on your regular home insurance policy. Not all companies provide these and most are limited in what they cover so check with your agent to be sure you don’t need a separate or additional policy for your home based business.

Identity Theft Rider: Gives limited coverage and reimbursement for identity theft.

Additional Structures: This can be adding an attached (or unattached) porch or deck, shed or outbuildings, fences and other such items that are added to an existing home or mobile home policy.

For more information read our Understanding Home and Mobile Home Insurance posts.

General Property Liability Policy: Many times a person who owns rental property can have up to 5 or more locations covered on one policy. Adding or removing a property to an existing policy is done by endorsement.

These are just a few examples of Endorsements/Riders available to your home, mobile home or Gen. Liability policies. If you’re in need of additional coverage on your existing policy OR in need of a new policy, give us a call!

Until next time remember….The more you know, the less confused you’ll be.
 Tommy Curtis and Staff