Must-have riders for your Term Life Insurance cover

Here are different riders you should know about and consider adding to your term life insurance cover.

Written by Sajja Praveen Chowdary

Insurance buyers are no strangers to uncertainty. In fact, they are a step ahead and better prepared for it. Yet, most people don’t factor in the uncertainty of critical diseases and disabilities while adopting a term insurance plan. Surviving a tragic accident or a major illness is never easy. While it is a great relief to come out of it alive, any kind of disability just builds up to the inevitable emotional and financial trauma. Although there is little to no control over an unfortunate casualty – or the disability arising out of it – one can surely safeguard themselves and their loved ones from the imminent financial setback.

On one hand, term insurance offers a full-fledged financial cover to dependents in the event of the sudden death of the policyholder, but it does not suffice to cover the risks associated with outliving a major accident or illness. This is where insurance riders come into the picture. Term insurance riders are the add-ons to the base policy that provide additional benefits to the policyholder at a small additional cost to the premium. These riders not only offer protection from these unfortunate events but also make your policy wholesome and more comprehensive.

The awareness around these riders is still pretty low in India. So, here are different riders you should know about and consider adding to your term life insurance cover:

Accidental Disability Benefit Rider

As the name suggests, this rider offers additional cover to the insured person in case of accidental disability. It’s no secret that India continues to be a hotbed for fatal road accidents with government data reporting as many as 1.2 lakh lives lost to accidents in 2020 alone and it left much more people disabled. Unfortunately, accidents go beyond car crashes and train wrecks, and might as well occur in safer spots like workplaces or homes.

No one can foresee what a sudden casualty will entail. Even if the policyholder survives a major accident, there is a high possibility of a permanent disability. This not only threatens to uproot the financial resources of the family but also potentially wipe out a regular source of income from employment. To overcome the gravity of such a loss, it’s better to have an accident disability rider added to your policy. For instance, if you opt for a rider with a cover of Rs 25 lakh then the Insurer will pay you this cover amount in case you end up with disability post an accident.

Critical Illness Rider

We live in a world where illnesses are not so rare anymore. Life-threatening conditions like heart attack, stroke, kidney-related ailments or cancer often don’t come with a warning sign and can devastate an entire family. While health insurance might be able to take care of hospitalization expenses, what many people end up doing is that they limit the level of treatment/care basis their health insurance cover which is also most of the time, limited to what the employer provides and ends up being inadequate. Having an extra source of money with you in such a situation helps in deciding to go for a better healthcare which increases the chance of survival and faster recovery. Similarly, this extra source of money can help you take leave without pay for the next 2-3 months without worrying about the EMIs or how the expenses for these 3 months will be taken care of.

Critical illness rider is this extra source of money. On diagnosis of a critical illness, this rider pays the cover amount irrespective of hospitalization costs. With this additional source of money, you can upgrade to a better hospital, if required, to speed up the recovery process or peacefully be at home for the recovery period without worrying about salary not coming in.

Waiver of Premium Rider

An accidental disability leaves the person unemployable in most cases and probably continuing term insurance becomes all the more important in such a scenario. However, the policyholder might not be able to pay the recurring premium, given the loss of employment. This waiver of premium rider lets you keep the policy active, nevertheless by waiving off your future premiums in such a scenario.

The next time you plan to buy your term insurance policy, do not forget to compare different plans and check these riders in detail and add them as per your insurance needs.

The author is Head-Term Life Insurance at Views expressed are that of the author.

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