Kicker Clause
An insurance policy provision that provides additional benefits or coverage enhancements beyond the basic policy terms. These clauses typically activate under specific circumstances to provide extra protection or compensation to the policyholder.
Example
“The life insurance policy included a kicker clause that doubled the death benefit if the insured died in an accident before age 65.”
Memory Tip
Kicker clause = 'Kicks in extra benefits' when you need them most.
Why It Matters
Kicker clauses can significantly increase the value of insurance policies by providing enhanced benefits during critical situations. These provisions often make the difference between adequate and comprehensive coverage when claims occur.
Common Misconception
Many policyholders overlook kicker clauses when reviewing their coverage, assuming they only get basic benefits. However, these clauses often provide the most valuable coverage enhancements and should be carefully understood and utilized.
In Practice
A homeowner pays an extra $50 annually for a kicker clause that increases dwelling coverage by 25% for natural disasters. When a tornado causes $200,000 in damage to their $180,000 policy limit home, the kicker clause provides an additional $45,000 in coverage, paying out $225,000 total instead of leaving them $20,000 short. The $50 annual cost saved them from a significant out-of-pocket expense.
Etymology
The term 'kicker' comes from gambling and sports, meaning an extra advantage or boost. In insurance, it represents additional benefits that 'kick in' to enhance basic coverage.
Common Misspellings
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