A basic life insurance policy may not be enough when securing your family’s future. Riders, optional add-ons to your policy, can significantly enhance your coverage by offering additional protection against unforeseen events like critical illnesses, accidental death, or disability. Understanding these riders and their benefits can help you maximise your policy’s potential. Read this blog to understand how to maximise your term plan coverage and what riders to consider in your policy.
What are Riders in Life Insurance Policy?
Riders are affordable add-ons you can attach to your existing life insurance policy, whether it’s an endowment plan, term insurance, or whole life insurance plan. While your policy covers death and maturity benefits (depending on the type of policy), riders broaden your coverage by providing additional financial protection for risks such as accidental death, critical illnesses, and permanent disability income support.
What are the Most Essential Riders to Consider When Choosing a Life Insurance Policy?
These are the following riders that eminent insurance providers provide:
1. Critical Illness Rider
If you’re diagnosed with a serious illness, the Critical Illness Rider steps in offering coverage for conditions like heart attack, cancer, and stroke. Upon diagnosis of a covered illness, this rider offers you a lump sum payment to help you manage medical expenses or financial needs during recovery.
2. Accidental Death Benefit Rider
The Accidental Death Benefit Rider is a cost-effective way to add extra protection to your life insurance. Designed to safeguard your family, this rider provides an additional lump sum payment to your beneficiaries in case of accidental death on top of the death benefit from your base policy. An Accidental Death Benefit Rider offers this crucial coverage at budget-friendly premiums and ensures your loved ones much-needed financial support.
3. Waiver of Premium Rider
The Waiver of Premium Rider is a crucial feature that waives future premiums if you are unable to pay due to any disability or income loss. Not only does it waive every future insurance premium, but it keeps your policy in force for its entire term. Without this rider, missed premiums or disability could result in your nominees not receiving the death or maturity benefits.
4. Permanent and Partial Disability Rider
The Permanent and Partial Disability Rider is essential if you become disabled and cannot work. It ensures a steady income to cover medical treatment and rehabilitation expenditures. This rider provides an additional sum to cover your day-to-day expenses to help you maintain your lifestyle despite the disability. Additionally, your insurer can also waive all future premiums to ensure your coverage remains intact without adding financial strain during a challenging time.
5. Income Benefit Rider
The Income Benefit Rider will provide vital financial support if you are disabled and are unable to work. During difficult times, this rider helps you keep your quality of life by providing a consistent income for a predetermined period.
6. Long-term Care Rider
A useful addition to your insurance is the Long-term Care Rider, which provides coverage for extended care services, including assisted living, home health care, and nursing facility care. This rider is helpful for those who anticipate requiring long-term care due to age, illness, or disability.
7. Guaranteed Insurability Rider
The Guaranteed Insurability Rider is a crucial addition to your policy if you wish to obtain more coverage later without going through an examination or underwriting. This rider can be especially helpful if you anticipate changes in your financial or physical status.
What are the Benefits of Life Insurance Policy Riders?
Life insurance plan riders in India make millions of policyholders’ lives easier. By choosing these add-ons, they fulfil their coverage needs without spending more money on a new policy. That is what makes riders valuable additions to a base plan. Here are some of the advantages of riders:
● Highly Flexible
You can add riders to suit your unique requirements. Based on your evolving needs, you can include them in your term, whole life, endowment, insurance plans, etc.
● Highly Affordable
You can cost-effectively improve your life insurance coverage with riders without buying a policy.
● Tax Benefits
Under Section 80D of the Income Tax Act, the premiums you pay for life insurance plan riders, such as critical illness, surgical care, or similar covers, are eligible for tax deductions.
The Bottom Line
Incorporating riders into your life insurance policy is a smart move for getting extensive
coverage that is customisable to your needs. With the right riders, you can secure financial stability for your family, no matter what life throws your way. Therefore, you should not just settle for basic coverage. You should consider these essential riders to enhance your policy’s value.
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