Is It Better To Add A Premium Rider With A Child Insurance Policy?
Table of Contents
It is normal for every parent to get worried about their child's future every now and then. And the best way to find a cure for that worry is to buy a child life insurance plan. A child life insurance plan ensures that your child has a financially secure future, and that's why most parents decide to buy it.
When the parents start hunting for an insurance plan, the common question that comes to their mind is whether they should add a premium rider to their child's life insurance policy or not. And it is essential that the parents know all these riders and what are the benefits that they offer. So, keep reading to learn all about the riders and is it better to add it to your insurance policy.
What is a Premium Waiver Rider?
Waiver of premium rider is an added feature of a child life insurance policy that waives off all the premiums that are due if the sole earner of the family gets into an unfortunate accident and dies. It is an additional cover that most people purchase along with the insurance plan to increase the value of their insurance policy.
One perk that makes this added feature exceptional is the fact that there is no maximum amount of premium that will get waived off. It means that no matter the amount of premium which needs to be paid, if the earning person of the family gets into some kind of accident, gets a disability, or dies, the premium will be waived off by the insurance company.
There are no restrictions that you have to buy a rider at the time of the purchase of the policy only. Riders are the add-ons that you can add to your policy years after you have purchased it.
What are the Benefits of Adding a Premium Waiver Rider?
Riders provide coverage in a number of possible scenarios. Some of the benefits of adding a premium waiver rider to your life insurance policy are:
1. Protection Against Unfortunate Incidents
Riders provide coverage for situations like the death of a parent, critical illness, or a permanent disability that takes their ability to earn further. All the premiums in that situation are waved off. That means the policyholder will no longer be required to give any of the premium payments, and his child life insurance policy will also remain unaffected. It will not get terminated and continue normally. The kid will get the initially promised lump sum amount after the policy has matured.
2. Tax Benefits
The policyholder can get tax benefits for the premiums paid during the term of the policy. And the benefits also extend to the waived-off premiums, if there are any. According to the 80C section of the Income Tax Act, 1961, tax exemptions of up to Rs. 1.5 lakhs are possible under the premium on riders.
3. Provides Mental Peace
Premium riders are low-cost additional benefits of a child life insurance policy. You can add it to your existing policy for a very low cost, and it will give you coverage against so many different possible scenarios.
It gives a feeling of mental peace to the policyholder that even if some kind of unfortunate event occurs in the future, their child will not have to face the repercussions of that. They will get coverage against any kind of accident or disability the policyholder undergoes.
Riders make sure that your policy does not get lapsed because of just a single misfortune event. So, your child will get a financially secure future regardless of what happens in the present.
Endnotes
Premium riders are the additional benefits that a policyholder can get added to their existing policy. It provides coverage against a number of scenarios and waives off the remaining premium payments without letting the policy get affected. That means you can take a breath of relief without having any stress about your kid's future.
Also read: Everything To Know About The Max Life Future Genius Education
A Child Life Insurance Plan Can Help Protect Your Child's Future
