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Ref. No. KLI/22-23/E-BB/492
Accidental death benefit riders offer invaluable financial security for policyholders in case of any unfortunate event.
An accidental death benefit is a bonus payout, like double duty on your life insurance, if the insured dies in an accident. It gives your loved ones extra financial support during a difficult time. While buying a life insurance policy, there is an option for adding an accidental death benefit as a rider.
Accidents are unfortunate events that have the ability to turn your life around suddenly. In such cases, having control and being prepared for all consequences is essential. One way to be prepared is to have a term or life insurance plan that takes care of your family’s finances when you are not there to take care of them. Your insurance policy should enable your family to maintain the standard of living that you want them to have. And if your policy does not provide an accidental death benefit, then you can add this to your policy as an additional rider.
Accidental death benefit riders offer an optional layer of security to standard life insurance policies. At the policyholder’s request, these riders provide an additional financial cushion for beneficiaries in the event of the insured’s accidental demise. Accidental death insurance benefits are precious due to the unpredictability of accidents and their potential to inflict significant financial hardship on loved ones.
Individuals employed in potentially hazardous environments or those with above-average driving exposure, whether professionally or through frequent commuting, stand to benefit significantly from accidental death benefit riders. This supplemental coverage mitigates the financial impact of unforeseen accidents, ensuring greater peace of mind for the insured and their dependents.
It is important to note that accidental death benefit riders come at an additional cost, reflected in increased premiums on top of the base policy. However, the enhanced payout received by beneficiaries, the sum of the standard death and supplementary benefits, often justifies the extra expense. It is also worth noting that these riders typically have age limitations, commonly expiring at ages 60, 70, or 80.
Accidental Benefit Riders, typically offered as add-ons to life insurance policies, provide additional financial protection in case of accidental death or disability.
Choosing a plan that protects your family even during your absence is vital. It is essential to review the specific terms and conditions of the insurance policy and rider you are interested in:
The policy will have a specific definition of what qualifies as an accidental death. This definition may include events such as car accidents, falls, or other sudden and unforeseen accidents.
The rider provides an additional benefit amount in the event of accidental death. The coverage amount is usually a specified sum or a multiple of the base life insurance policy’s face amount.
There may be exclusions or limitations on coverage. For example, deaths resulting from certain activities, such as participating in hazardous sports or intentional self-inflicted injuries, may be excluded.
Eligibility for Accidental Death Benefit riders may depend on factors such as age, health status, and other underwriting criteria. Some policies may automatically include this rider, while others require an additional premium.
Adding an Accidental Death Benefit rider involves paying an additional fee with your existing policy premium. The cost can vary between insurance companies.
In the event of an accidental death, there are usually specific procedures and requirements for notifying the insurance company and filing a claim. Failure to adhere to these requirements could impact the payout.
Compared to the potential financial impact of an accidental death, the cost of an accidental death benefit rider is often nominal. For individuals in high-risk professions or with dependent families, it is a cost-effective way to provide significant financial protection at a critical time. By carefully considering their occupational risks and lifestyle factors, individuals can determine if adding an accidental death benefit rider is a prudent choice. This proactive measure offers invaluable financial security in the event of an unforeseen accident, safeguarding the well-being of loved ones during a difficult time.
Amit Raje is an experienced marketer who has worked in various Fintechs and leading Financial companies in India. With focused experience in Digital, Amit has pioneered multiple digital commerce in India. Now, close to two decades later, he is the vice president and head of the D2C business department. He masters the skill of strategic management, also being certified in it from IIMA. He has challenged his challenges and contributed his efforts in this journey of digital transformation.
Prasad Pimple has a decade-long experience in the Life insurance sector and as EVP, Kotak Life heads Digital Business. He is responsible for developing user friendly product journeys, creating consumer awareness and helping consumers in identifying need for life insurance solutions. He has 20+ years of experience in creating and building business verticals across Insurance, Telecom and Banking sectors
Ref. No. KLI/22-23/E-BB/2435
The information herein is meant only for general reading purposes and the views being expressed only constitute opinions and therefore cannot be considered as guidelines, recommendations or as a professional guide for the readers. The content has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Recipients of this information are advised to rely on their own analysis, interpretations & investigations. Readers are also advised to seek independent professional advice in order to arrive at an informed investment decision. Further customer is the advised to go through the sales brochure before conducting any sale. Above illustrations are only for understanding, it is not directly or indirectly related to the performance of any product or plans of Kotak Life.
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