What is the purpose of the children's term rider (CTR) in life insurance policies?

The children's term rider (CTR) in life insurance policies is designed to add coverage for children at a specified amount for a limited time. This rider allows policyholders to include their children under the policy without the need for separate premiums for each child. Typically, this coverage lasts until the children reach a certain age, often 18 or 21 years, depending on the terms of the rider.

By providing a fixed amount of coverage for children, this rider ensures that families have a financial safety net in the event of unforeseen circumstances, such as the death of a child. This added benefit is especially valuable as it can alleviate concerns about funeral costs and other related expenses during a difficult emotional time.

The other choices focus on aspects that do not accurately reflect the primary function of the children's term rider. The option that mentions coverage until age 21 does seize on a portion of the concept, but it does not clarify that this coverage is for a specified amount and applicable for a limited time, which is what sets the rider apart as a temporary and additional component of the life insurance policy. As such, the accurate definition of the children's term rider aligns with the idea of adding children to coverage without the complexities of altering individual policies or facing differing premiums for each child.