What is the primary purpose of a rider in a life insurance policy?

The primary purpose of a rider in a life insurance policy is to modify policy terms based on the policyholder's individual needs. Riders are additional provisions that can be added to a standard life insurance policy to enhance or adjust the coverage. They allow the insured to personalize their policy by adding specific features, such as accidental death benefits, waiver of premium in case of disability, or accelerated death benefits in case of terminal illness. This customization enables policyholders to tailor their insurance coverage to better fit their unique circumstances and financial goals.

In contrast, the other options do not accurately reflect the function of a rider. Adding a rider does not inherently increase premiums without providing an associated benefit, nor does it reduce the coverage term or limit the insurer's liability in the way described. Instead, riders are designed to enhance the policy and ensure it meets the evolving needs of the policyholder.