Final answer:
The type of life insurance rider that provides additional coverage if the insured dies due to an accident is called the Accidental Death Rider. It pays out an extra death benefit over and above the basic policy to ensure financial support to the beneficiary.
Option 'a' is the correct.
Step-by-step explanation:
Life Insurance Riders
If an insured person dies as a result of an accident, the type of life insurance rider that provides additional coverage is known as an Accidental Death Rider. Life insurance policies with an accidental death rider will pay out an additional sum of money, often referred to as a death benefit, to the beneficiary of the policy if the policyholder's death is accidental.
This is over and above what would normally be paid out under the basic policy.
This rider is meant to provide extra security and financial support to families in the event of an unforeseen accident leading to the policyholder's death. Suppose, for example, if the primary life insurance policy has a death benefit of $200,000, and the accidental death rider promises to pay an additional $100,000 in the event of an accidental death, the beneficiary would receive a total of $300,000.
Other types of riders mentioned, such as the Payor Rider, Accelerated Rider, and Extended Term Rider, provide different benefits. A Payor Rider is typically added to a child's life insurance policy, and it waives the premium payments if the policyholder (typically the child's parent or guardian) becomes disabled or dies.
An Accelerated Rider allows policyholders to access a portion of the death benefit if they are diagnosed with a terminal illness, while the Extended Term Rider allows the policy to continue as term insurance for a specified period after the premium payment stops.