Term Insurance Riders You Should Know About - Greyfont

Term Insurance Riders You Should Know About


Term insurance is one of the simplest forms of life insurance in India. Under this type of life insurance plan, the nominee receives the sum assured if the policyholder dies anytime during the term of the policy. This plan is commonly known as protection plan as it protects your family financially in the even of your death. However, the plan does not provide coverage if the policyholder outlives the term. Attaching a host of riders along with the base term plan can prove to be beneficial. Read below about different types of riders you can buy with a term plan.


What is a rider?

A rider is simply an add-on cover that provides you with additional coverage at a reasonably higher premium. You can opt to buy a rider with base term plan to increase the term insurance coverage you want to provide your family with. Rider attached to a term insurance policy provides you coverage over and above the primary term plan.


Riders offered with term insurance

Accidental death benefit rider: This rider makes for an apt choice for an individual who travels often or is majorly involved in travelling business. Buying this rider provides your nominee with supplementary coverage, thereby compensating him with sum assured as well as the accidental benefit. However, the benefit is only provided if the insured dies due to an accident anytime within 3 months. Also, the premium for this rider is 60%-70% low in comparison of a base term plan.


1. Permanent and partial disability rider: In case of permanent and partial disability, the policyholder is eligible to receive the sum assured. A certain percentage of the sum assured is paid to the insured for 5-10 years and the nominee is paid the sum assured on death due to disability. Thus, this rider ensures that your family is able to make ends meet when you are permanently or partially disabled.


2. Critical illness: This rider provides coverage to the insured in case he is diagnosed with critical illnesses such as stroke, cancer, kidney failure, etc. The insured is given a pre-determined amount if anytime during the term of the policy he is diagnosed with any critical illness. Depending on the terms and conditions of the policy, the base term plan continues or terminates. Also, the critical illnesses covered under this rider differ from insurer to insurer.


3. Waiver of premium rider: If anytime during the term of the policy if the policyholder due to death of disability is unable to pay the premiums, then this rider waives off all the future premiums that have to be paid. This rider is a good choice for parents who are insuring their children.


4. Income benefit rider: This rider provides your family with a steady income flow along with the sum assured offered with the base term plan. This rider is a good choice for individuals who are the sole breadwinners of a family.


5. Accelerated death benefit: This rider compensates the insured with a certain part of the base sum assured in case he is critically ill. It pays the insured in advance for the treatment of any critical illness and its associated costs. 


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