Everyone’s life insurance needs are unique. That’s why many providers offer life insurance riders, which are optional features you can add to your policy to help you customize your coverage.

Inflation riders are designed to adjust the dollar amount of your coverage to keep up with rising costs, such as medical care. Generally, your death benefit will increase by a fixed percentage every year to address inflation and rising expenses. Increased coverage does mean a higher premium, but you can end up saving thousands of dollars on future care and end-of-life costs.

You can add these riders to current life insurance plans, such as term life or long-term care (LTC) policies. The types of inflation riders available will vary, depending on your provider, but here are a few options you may have:

• Guaranteed purchase option (GPO): You can buy the option to increase the amount of your coverage every two or three years for your term care insurance or term life plan, without having to get approved multiple times.
• Simple inflation protection: This rider increases your death benefit automatically every year by a percentage you choose with your insurer, usually 3-5%.
• Compound inflation protection: Like simple inflation protection, your coverage amount would increase by a percentage each year. The difference is that instead of a flat rate, your benefit goes up with compound interest, rather than rising by a flat amount each year.