Term Insurance Riders
A term insurance policy is a financial backup for a family during unprecedented situations. However, at times only the insurance coverage amount does not suffice some extra uncertain expenses such as treatment cost of critical illness, loss of income due to accidental death or disability, amongst others make occur. Therefore, riders provide additional protection that can help you in such situations.
What are riders?
Riders are additional benefits that help to boost the coverage of your base plan. There are various kinds of riders available, which can be added by paying a bit extra amount and the premium. The riders provide add-on financial benefits apart from your base sum assured.
Different types of Riders available with Term Plans
- Critical Illness Rider
- Permanent and Partial Disability Rider
- Accidental Death Rider
- Waiver of Premium Rider
- Income Benefit Rider
- Accelerated Death Benefit Rider
1. Critical Illness Rider
Medical emergencies can knock on your door at any time. And the high cost of treatments can make you vulnerable. Critical illnesses like heart attack, cancer, kidney failure, to name a few, are illnesses that can drain your entire savings. Hence, a critical illness rider compensates you with extra financial assistance in the form of a lump-sum amount when diagnosed with any of the listed critical illnesses in the policy. However, it would help if you go through your policy documents to know about the critical illnesses covered. The premium of the rider remains the same till the end of the policy term.
2. Permanent and Partial Disability Rider
If you meet with an accident and become disabled due to the loss of your arms or legs, then your livelihood gets hampered. Your family would end up being in a miserable condition due to loss of income. In such a situation, Permanent and Partial Disability Rider comes as a financial cushion. The rider acts as a substitute for your income and lets your family comfortably manage their regular expenses. It comes into effect only when the disability occurs because of an accident. If it’s a total disability, then the entire sum assured is given, and if it’s a partial disability, the partial sum assured is offered. However, the terms and conditions differ from one insurer to another.
3. Accidental Death Rider
Life is full of unexpected twists and turns, and no one can predict what will happen in the next moment. If you pass away due to an accident, then your dependents will get the sum assured or the death benefit amount in case of a term insurance plan. However, in today’s fast-paced changing lifestyle and increasing expenses, the sum assured amount might not be sufficient. Therefore, an accidental death benefit rider provides an additional layer of security for your family. It is applicable only in case of accidental death. The premium charged is low as the rider covers only untimely accidental deaths. If the death occurs within 3 months of the accident, the family is eligible for the sum assured. The premium remains fixed for the entire policy tenure.
4. Waiver of Premium Rider
If you lose your income due to disability and cannot pay your term plan’s future premiums, the policy usually expires. And you don’t get any death benefit because of the non-payment of the premiums. But if you have opted for waiver of premium rider, then your future premiums get waived off and the policy remains active. So it is a beneficial rider to reduce financial stress.
5. Income Benefit Rider
If you are the sole earner of the family, then after your demise, the regular flow of income will get affected. In such a situation, this rider is a boon. Income Benefit Rider provides additional income to the deceased insured’s family for the next 5 to 10 years along with the sum assured amount.
6. Accelerated Death Benefit Rider
If you are suffering from a terminal illness, your family will be under a huge financial burden due to the high medical cost of your treatment. So, this rider pays you a partial amount in advance from your sum assured when you are critically ill. You can use this advance payment for the treatment. And after your demise, your family or the policy nominee gets the remaining amount. Thus, it is a helpful rider for your family to cope with expenses during your last days and even when you are not with them.
The bottom line is Term Insurance Riders boost the scope of coverage of your base term insurance plan. However, every rider has its own benefits, so you need to understand the terms and conditions of each of them thoroughly and then make the decision of your preferred rider.
Compromising the happiness of your loved one is not correct when you have the option of giving them a secured life by shelling out a little bit extra. So, visit iiflinsurance.com and know about various riders available with different term plans. Assess your requirements and then get the right one.