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2 Must have Riders for your Term insurance Cover

Term insurance is a form of life insurance where policyholders can provide financial security to their family members in the case of an unfortunate event.

The purest form of life insurance policy, a term plan, is the most affordable. In this, the policyholder is insured for a specified term. The nominee gets the sum assured upon the policyholder’s death if it happens within the term. The premiums, once fixed, do not change for the entire duration. The maximum maturity age of the policy can differ based on the insurance company you choose, which is usually 75 years.

In case the policyholder survives the term, there is no benefit given to the policyholder. While it is known for being affordable at low premiums, there are riders that policyholders can opt for to enhance the policy’s coverage.

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Two of the most important add-ons policyholders can consider taking with their term plan are-

1. Accidental Disability Rider

India witnesses lakhs of road and workplace accidents each year, unfortunately leading to the death or disability of thousands. While we cannot protect ourselves 100% from such accidents, we can take steps to provide financial protection to our families in such cases. Taking an accident disability rider, as the name suggests, can help policyholders provide financial cover for their family members and themselves in case of getting permanently disabled in an accident.

This rider is valid when the permanent accidental disabilities have lasted for six consecutive months and are said to be irreparable by a certified medical professional. In such a scenario, the policyholders are paid a regular monthly income equal to 1% of the assured sum for a time period, usually 10 years.

Note that there are certain exceptions to this rider. The rider will not be valid if the permanent disability is;

  • Due to a pre-existing disease
  • Due to taking part in an adventure or hazardous sport, such as bungee jumping, mountaineering, racing, etc.
  • Due to alcohol or drug abuse
  • Due to taking part in any riots, strikes, etc.
  • Due to a criminal or illegal activity

While this rider is great if you work in a high-risk environment, all term plan policyholders are recommended to take this.

2. Critical Illness Rider

Illnesses are often unexpected and always take a huge toll on a person and their family. An illness just doesn’t impact the one who is suffering from it but also the family members. The impact is more so if the person suffering from the illness is a bread earner. In such scenarios, a critical illness could take a toll on a family’s finances and even result in loss of income. The critical illness rider in a term plan helps policyholders provide financial protection to themselves and their family members if detected with a critical illness. The insurance company usually lists down the list of critical illnesses that will make the policyholder and their nominee eligible to receive the benefit that includes, but not limited to;

  • Cancer
  • Heart Attack
  • Kidney failure
  • Last stage liver or kidney disease
  • Loss of limbs or sight

A pre-defined lump sum is paid either to the policyholder or their nominee.

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There are many benefits of taking this rider, such as;

  • It helps policyholders pay the hospital bills that are not covered by the health insurance policy.
  • It helps policyholders supplement their income resulting from loss of work.
  • It helps provide financial stability to the family members and meet financial obligations.

These riders can ensure that all the corners are covered. However, apart from these riders, it is also important to choose the right type of term plan. While there is the well-known pure term plan, you can opt for other types of plans too. For instance, HDFC term plan comes in various options such as pure term plan, return of premium plan, etc.

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Choose the right plan and take these add-ons to make the most of your policy.

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