Posted by Nowadays, the majority of term insurance plans offer a variety of advantages and features to make life easier for you and your family. With options like the claim payout option, limited pay option, increasing cover, and others, you have several ways to tailor your policy to the needs of your family. Apart from these customization options, many insurers also give you the choice of using riders to extend the coverage of your term plan.
What are riders and how they are helpful?
By being attached to the base plan with a simple agreement, riders extend the total amount of coverage provided by their term insurance or provide incremental coverage.
You can benefit from these ready-made additions to your term insurance policy by paying a small premium. One of the most practical customizations is term insurance riders. Once you have submitted the necessary documentation for your base plan, you are not required to submit any additional documentation or go through a medical exam to purchase a rider. Additionally, it saves you from having to manage numerous insurance plans for all potential scenarios.
Types Of Riders
1)Critical Illness benefits the rider
If the insured passes away in the unfortunate event of an accident, one can obtain an additional sum assured by adding an accidental death benefit rider. The original sum assured is used as the basis for calculating the additional sum assured, which varies from company to company. For the duration of the policy term, the premium for this rider is fixed. There may be a cap on the maximum sum assured, though, depending on the plan.
2)Accelerated Death Benefit Rider
A person with a terminal illness, such as cancer, asthma, kidney failure, lung damage, etc., must pay a significant sum of money for medical expenses incurred as a result of the treatment. However, accelerated death benefit riders give the family a portion of the assured amount up front, which can be very helpful in trying times.
3)Accidental Death Benefit Rider
With an accidental death benefit rider, an additional sum assured can be obtained in the unfortunate event that the insured dies in an accident. The original sum assured is used as the basis for calculating the additional sum assured, which varies from company to company. For the duration of the policy term, the premium for this rider is fixed. There may be a limit on the maximum sum assured, though, depending on the plan.
4)Accidental Disability Benefit Rider
The insured can receive benefits from this rider if they are disabled permanently or partially as a result of an accident. If you are covered by the accidental disability benefit rider, term insurance plans typically pay you for 5–10 years following the accident that caused your disability. This rider is frequently combined with accidental death riders and can be considered a source of income.
5) Waiver Of Premium Rider
As the name implies, it waives future premiums if the policyholder becomes disabled or experiences a loss of income and is unable to pay them. You could say that by doing this, you can guarantee premium payments up until the policy’s expiration. The policy will expire and no death benefit will be paid because the premiums were not paid if the insured does not have a waiver of premium rider and experiences a disability or is otherwise unable to pay the required premium.
6)Income Benefit Rider
By adding a premium at the time the policy is purchased, you can purchase this additional useful rider. In the unfortunate event that the policyholder passes away, the income benefit rider may be considered a source of income. With this rider, the policyholder’s family will receive additional income each year in addition to the regular sum assured for a period of five to ten years.
7)Child Support Benefit Rider
One of the important riders to have in addition to a base term insurance policy is the child support benefit rider. When the parents pass away, the child support benefit rider pays an additional CSB sum that is guaranteed (policyholder). The main goal of the child support benefit rider is to make sure that the child’s needs are met if one or both parents pass away. Additionally, the child can honor various life milestones without giving up on their aspirations due to financial constraints. The child should also be benefited from
Benefits Of Term Insurance Riders
Under your term insurance plan, riders provide more coverage. However, buying term insurance riders also has other advantages. Here are some of them explained:
1)Enhanced Sum Assured
Some riders for term insurance also improve the overall coverage. For instance, if you purchase a critical illness benefit rider for your base term insurance policy, which has a sum assured benefit of Rs. 1 Crore, you can also get an additional Rs. 25 Lakh in coverage.
2)Protection For Family
The most significant benefit of term insurance riders is that they provide the family of the insured with the necessary financial protection in the event of an unfortunate event. In addition to protecting in the event of death, the riders also do so in the event of total or partial permanent disability as well as serious illnesses like cancer, stroke, kidney failure, etc.
3)Affordable
Riders for term insurance provide excellent benefits at low premiums. It is preferable to purchase riders rather than separate covers, such as accident and critical insurance, as the latter would be more expensive. The insured will also be responsible for managing multiple policies at once. Additionally, purchasing riders enables you to receive combined benefits under one policy rather than having to buy multiple policies.