The Future Increase Rider, also known as the Future Increase Option (FIO)

The Future Increase Rider is commonly referred to as the “Future Increase Option” (FIO) and is an optional rider available within your Disability Insurance Plan.  The advantage of the FIO Rider is that you can start out with a smaller Disability Insurance Plan initially while having the guaranteed ability to add disability benefits to your plan in the future.  This means as your career and income grow, you can expand your benefit coverage should you choose to do so.  

Depending on the insurance carrier you are evaluating, this rider might be referenced using slightly different terminology or acronyms since individual carriers offers different versions of the rider.  

Below is a list of the many possible names of the “Future Increase Option” rider:

  • Guaranteed Insurance Option (GIO)
  • Future Purchase Option (FPO)
  • Benefit Purchase Rider (BPR)
  • Guaranteed Insurability Option (GIO)
  • Guarantee of Physical Insurability (GPI)
  • Benefit Update (BU)
  • Benefit Increase Rider (BIR)

Some of the versions of the rider are identical, but others have unique characteristics that are worth discussing.  For example, some options allow you to increase your benefits once per year; whereas other versions only give you the opportunity to increase your coverage once every three years.  Different rider versions can also apply limits to how much coverage you are allowed to increase at any given time.  

The one universal thing that all versions have in common is the guaranteed ability to increase your benefits in the future without having to undergo any additional health questioning or new medical exams.  If you have had any negative health changes from the time that you originally purchased your Disability Insurance Plan and the time that you are ready to increase your coverage, your health won’t detrimentally impact your ability to secure additional benefits. There is only one qualifying factor: At the time that you decide to obtain additional coverage, your income must qualify you for increased benefit coverage.

The Future Increase Option is commonly used as a strategy for 4th year medical students and residents or fellows. By adding a FIO Rider, you can opt for a lower benefit level that is affordable during training.  Then, when you have completed training and are entering your field of medicine, you can increase your disability benefits to protect your growing income.

If you are weighing whether or not you might want to add to your benefit level down the road, then it’s highly recommended that you explore the addition of a FIO rider.

If you are an established physician well into your career and are satisfied with the benefit coverage level afforded on your plan, then there is really no need for you to add this rider.  In fact, if you are well into your career and don’t foresee ever raising your benefit level and have this rider in place, then it would be likely recommended that you drop this rider from your plan in order to save money on future premiums.

Please work with an experienced insurance agent who can advise you and help you navigate the benefits of Future Increase Option rider and which version is most suitable for you.

As always, we’re here to help!

Chris Wimberly

The Disability Doc

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*This information is solely used for general market educational purposes.  It does not provide legal rights or actual carrier policy language.  Please review the respective policies for the complete terms and conditions.