You may have already purchased general insurance policies for the financial protection of your loved ones. However, what about their financial protection when you are no longer there to take care of things? A term policy can be their guide in such a situation. If you are the primary earning member of the family with financial dependents, experts suggest that buying a term policy is non-negotiable. Even though it is a simple insurance product, the coverage of a term insurance policy varies from insurer to insurer. If you are looking for more comprehensive coverage from a term insurance plan, then you may want to consider opting for some riders.
What is a term plan and how does it work?
To understand the riders better, we must first understand how a regular term plan works. When you buy a regular term plan, you pay premiums. These premiums go towards building your life cover. In the event of your demise within the term plan tenure, this life cover is provided to your loved ones to help them cope with the financial requirements of their day-to-day life. However, some people may find this amount of protection to be insufficient and may want more coverage. This can be achieved with the help of term insurance riders.
Even though your term premiums may increase by a bit when you opt for these riders, the benefits they offer in the due course of your plan will be worth it.
Term insurance riders you should consider buying
Critical illness insurance rider
The number of people getting diagnosed with critical illnesses is rising. And so are the costs associated with getting these illnesses treated. For a critical illness like cancer, the treatment costs can reach up to Rs 1 crore! If you do not have an insurance policy to take care of this, it may lead to your entire savings getting depleted. This is where the critical illness insurance rider comes into view. If you or other insured members are diagnosed with critical illnesses such as cancer, major organ transplant, kidney failure, strokes, and so on, then you receive a lump sum payment. This amount can be used to access high-quality treatment for these life-threatening ailments.
Accidental death benefit rider
The accidental death benefit rider provides a lump sum amount if the policyholder passes away in an unfortunate accident. Accidents can happen anytime. The number of deaths due to road accidents, for instance, has increased tremendously in the last few years. The family of the deceased has to deal not only with the emotional consequences but also the financial repercussions of losing an earning member. Therefore, one must consider opting for the accidental death benefit rider.
Note that the lump sum pay-out of this rider is provided in addition to the sum assured from the term policy in case of the policyholder’s death due to an accident.
Accidental permanent disability rider
The previously mentioned rider may take care of finances in case of death due to an accident. But what if the accident causes permanent disabilities? This can lead to the individual not being able to work anymore, which can cause financial difficulties in the long run. The accidental permanent disability rider helps out significantly in this scenario by providing a lump sum amount in the event of the policyholder suffering a partial or total permanent disability due to an accident.
Waiver of premium rider
If you are looking for term insurance riders that can help you cut down on the premiums in case of an unfortunate event, then this is it. The waiver of premium rider, as its name suggests, waives off the future premiums owed to the insurer in the case of the following events:
- Accidental permanent total disability
- First diagnosis of critical illness
This rider allows you and your loved ones to relieve any worries related to the premium payments of your term plan.
There might be conditions in regard to the person covered under the rider plan and the life assured covered under the base policy. It is advisable to connect with the insurance provider and get all your questions answered. Ensure to read the base policy document and the rider documents as well.
We hope this article has helped you get a deeper understanding of what a term plan is and how adding these riders can benefit you. Use the above information for making the best decision when buying term insurance.