Term Insurance With Riders In India

Term plans are an excellent option for those looking for a pure life cover. Such plans offer insurance coverage in case of death of the policyholder during the policy term. The insurance provider offers the sum assured amount to the beneficiary, which may be used to meet various financial obligations. This amount, therefore, acts as an income replacement, especially if you are the breadwinner of the family. Term plans are also known for their affordability, offering a high level of insurance cover at a low premium. Besides, you may enjoy tax benefits towards premiums paid up to an amount of INR 1.5 lakh under Section 80C of the Income Tax Act, 1961. Also, the death benefit amount can be claimed for income tax deduction under Section 10(10D).

Term Insurance Riders

A rider is an additional component that can be added to your new or existing term life insurance policy to increase your coverage. The benefits of the rider are extended beyond the perks offered by your plan. These term insurance riders allow you to enjoy a customized cover at an additional premium.

Here are five types of insurance riders in insurance that are most commonly bought by policyholder:

• Critical illness add-on

It is important to note that term plans do not offer coverage for critical illnesses such as permanent paralysis of limbs, cancer, or brain tumor, among others. Upon diagnosis of any of the critical illnesses as per your policy document, you are entitled to receive a lump sum amount. This helps you meet medical costs and other indirect expenses towards the treatment of the disease without any financial difficulty.

• Waiver of premium rider

Financial constraints may prevent you from making premium payments towards your term insurance plan. Opting for a waiver of premium rider ensures that you continue to enjoy the policy benefits even if you fail to pay the premium amount. Your term plan, therefore, does not lapse completely.

• Income benefit rider

In case you are the breadwinner of the family, chances are that your family may be left financially crippled in an unfortunate event. To avert such a scenario, you may purchase an income benefit rider. This rider provides a regular stream of income to your beneficiary, for a specified period, say five to ten years. Your loved ones may, therefore, manage their finances easily and have a good lifestyle even in your absence.

• Accidental death rider

As the name suggests, this rider in term insurance offers insurance coverage against accidental death. The insurance provider is entitled to offer an additional sum over and above the sum assured amount, in an event of death due to an accident.

• Permanent disability rider

This rider gives you the benefit of claiming the sum assured over a period of five years in case of an accident causing permanent disability. The rider benefit received can be used to replace the regular income and also pay for the indirect expenses of the family. As the payout is regular, it can ultimately take the place of your monthly salary and make sure that your family is not affected financially.

Riders in term insurance maximize your insurance coverage and help you gain control over the financial security of your loved ones. You may, therefore, choose the most appropriate term insurance riders according to your requirements and enjoy peace of mind at all times.