By Jarrod Heil
What Is an Insurance Rider, Endorsement and Floater?
Endorsements, riders and floaters can cause quite a bit of confusion to home insurance novices. But once you understand the facets and abilities each offer to your home insurance policy, you’ll realize they aren’t so complicated after all.
While endorsements and riders are the exact same thing, floaters are extremely similar but slightly different.
Ok, now let’s break down each of the three pesky insurance terms so that you can better understand what each is and be able to implement them in your own home insurance policy if you need to.
What Is an Insurance Rider?
An insurance rider is a slight tweak to your policy that allows you to increase the overall coverage of your home insurance for specific categories. When you add a rider to your policy, you essentially purchase additional coverage for category items, such as a collection of jewelry or drain backup.
By simply adding a rider, you can effectively make changes to parts of your home insurance policy without having to cancel your current policy and get another one.
What Is an Insurance Endorsement?
An insurance policy endorsement is the exact same thing as a rider. It’s just another word for it. The two terms, endorsement and rider, are used interchangeably and are simply an increase or all new coverage in specific categories that don’t come standard with an average home insurance policy.
For instance, many home insurance policies don’t come standard with sewer and drain backup coverage. Not to worry, in most cases, there’s an endorsement for that!
All you need to do is add a policy endorsement or rider to your policy to increase coverage limits on certain categories or extend coverage to specific categories you don’t currently have.
What Is a Personal Property Floater?
An insurance floater is similar to endorsements and riders, with one exception. Instead of increasing or extending coverage to certain categories, floaters increase or extend coverage to specific items. Jewelry and furs are among some of the most popular items that are attached to floaters.
Let’s go through an example. A policyholder has a $2,000 limit on jewelry coverage but owns $5,000 worth of jewelry. They’re currently underinsured by $3,000. Let’s assume that own a $1,500 gold necklace and a $1,500 diamond ring.
They can then add two floaters to their policy to extend coverage to each item, which may be just a small fee added to their premium each year. This means they just added coverage to their current policy instead of having to cancel their policy and get a new one.
Personal property floaters get their name because policyholders essentially float coverage to a specific item. This allows them to modify their existing home insurance policy instead of having to secure a new home insurance policy.
More Common Types of Endorsements, Riders & Floaters Offered by Universal Property & Casualty
- • Ordinance or law
- • Fungi, wet or dry rot, or bacteria
- • Increased theft coverage
- • Replacement cost loss settlement
- • Sinkhole loss coverage
- • Additional interest
- • Personal property replacement cost loss settlement
- • Water back-up and sump discharge or overflow
- • Additional insured
- • Windstorm protective devices
- • Premises alarm or fire protection system