Important Term Insurance Riders And Their Benefits
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A term insurance rider is an additional benefit which can be opted for over a standard term insurance policy. These riders come into play in case of a specific eventuality. They offer financial cover over and above the basic sum assured in a life insurance policy. Even with the occurrence of the events, the life cover remains intact. This means that even if you have drawn on a particular rider, you remain eligible for the death benefit on the term insurance plan.
Listed below are some of the most important term insurance riders that can provide you with extra benefits.
Important Term Insurance Riders And Their Benefits
Here's a list of important term riders that you should look at before purchasing any:
1. Accidental Death Rider
This term rider offers you additional sum assured if the insured dies due to an accident. The investors happen to have a myth that they will receive the sum assured if death happens due to an accident otherwise not. If you do not buy this rider, you will still be paid the basic sum assured. This rider is only for the supplementary sum assured in case the policyholder faces a death due to an accident.
2. Permanent And Partial Disabilities
This rider becomes greatly beneficial if you get permanent disability or temporary illness due to an accident. In such scenarios, most of the policies pay you regularly for next 5 to 10 years in a certain percentage of sum assured. You can therefore rely on this rider for an income source. This rider comes into force only if the disability happens due to an accident. Quite often, this term insurance rider is combined with Accident Death Rider.
3. Critical Illness Rider
You receive a lump sum amount if you are diagnosed with an illness which is pre-specified and is mentioned in the policy. All the major illnesses are a part of the critical illness rider. After critical illness is detected, the policy might continue or terminate as per the policy document. At times, the policy coverage lessens by the amount paid to you. So understand the policy document to know what exactly will happen in this rider.
4. Waiver of Premium
This rider ensures that the policy does not entitle you to surrender you to falter in paying your premium due to disability and income loss. In such cases, the future premiums get waived off but your policy is still in force as always. This in a way, is insurance of the premium payment till your policy expires. In case this rider is unavailable and you are disabled and eventually you are not able to pay the premium, the policy would expire and you will not get any death benefit at the time of your death as due to non-payment of premium the policy expires and the cover stops.
5. Income Benefit Rider
This rider is a part of some policies and is mainly income generation after the death of the policy holder. If this rider is present, the policy holder's family gets supplementary income per year for 5 to 10 years along with a regular sum assured.
Also Read:- How to Get a Loan Against a Life Insurance Policy?
Takeaway
The riders sure seem like a necessity if we consider eventualities like the ones mentioned above. It is true that we cannot prevent such incidents from happening but we can very well plan for them. Term insurance riders are a part of such planning. Their presence will help both you and your family.
