Term Insurance Riders: Types & Benefits
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Among the most common types of insurance bought by Indians is term insurance. These insurance policies are often designed to cover your family in the event of tragic and unanticipated events. For those who want to live stress-free lives with regard to their family, term insurance is a suitable solution.
Your insurance premium may be slightly higher if you want to add a separate rider to your term insurance policy. The increase varies according to the kind of rider you choose. These riders may be added without any connection to the primary insurance plan. The ideal strategy to select one of these riders is to first identify your future financial needs before focusing on the one that best meets your needs. To know more about important term insurance riders on types and their benefits, read on.
What Are The Types Of Term Insurance Riders And Their Benefits?
Following are the types of term insurance riders -
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Accidental Death Benefit Rider -
In any case, if the insured passes away in the unfortunate event of an accident, one might obtain an additional sum assured by adding an accidental death benefit rider. The initial sum assured, which typically varies from business to business, is calculated using the initial value pledged as the basis. For the duration of the policy term, the premium for this rider is set. There may be a restriction on the total sum insured, though, depending on the plan.
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Accelerated Death Benefit Rider -
A person with a terminal illness must spend a significant sum of money for medical expenditures incurred as a result of the treatment. However, a portion of the insured amount is given to the family up front through accelerated death benefit riders, which may be quite beneficial in tough situations.
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Critical Illness Benefit Rider -
When one of the severe diseases listed in the policy document is diagnosed, the insured may be eligible to receive a lump sum payment under a critical illness benefit rider. According to the terms and circumstances outlined in the policy, the coverage may be either continued or cancelled upon the identification of a critical illness.
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Premium Rider Waiver -
As the name implies, it waives future payments in the event that the policyholder becomes disabled or has a loss of income and is unable to pay them. You may say that by doing this, you can guarantee premium payments up to the policy's expiration. The policy will terminate and no death benefit would be given since the premiums were still not paid if the insured does not possess a waiver of premium rider and has a disability or is otherwise unable to pay the requisite premium.
A term insurance plan with riders ensures more coverage. Following are the types of term insurance riders -
- Enhanced Assured Sum - Some riders for term insurance also improve the overall coverage.
- Family Protection - One of the most significant advantages of term insurance riders is that they grant the family of the insured with the necessary financial security in the event of an unfortunate incident.
- Efficient - Riders for term insurance provide excellent advantages at low costs. 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 many policies at once.
- One Plan - Term insurance policies could give a high sum assured. A rider would be preferable to purchasing a brand-new insurance policy as base term insurance would not alone be adequate for our loved ones. Even more so than maintaining several term insurance policies, handling riders together with the term insurance plan would be simpler.
Endnotes
It is advised to carefully review all of the features and restrictions under the linked benefits prior to acquiring riders on any of the term insurance plans. Analyse your needs in relation to these requirements, and only then, following a thorough investigation, should you decide.
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