What does the term "Impairment" refer to in an Impairment Rider?

The term "Impairment" in an Impairment Rider specifically refers to the exclusion of coverage for certain pre-existing conditions. An Impairment Rider is a provision added to a life or health insurance policy that identifies specific health issues or conditions that the insurer will exclude from coverage. The purpose of this rider is to allow the insurer to manage risk by not covering existing health problems that might be likely to result in claims.

When a policyholder has a condition that will be excluded from coverage, the Impairment Rider will clarify which specific conditions are addressed. This rider provides both the insurer and the insured a clear understanding of what is not covered, thereby protecting the insurer from potential financial losses related to those pre-existing conditions while still allowing the rest of the policy to provide coverage for other health issues.