Insurance plans have become the need of the hour. Every individual must take at least one insurance policy that can cover his/her financial requirements. It is not only for personal benefit, but it helps in covering your family’s needs in your absence. When it comes to insurance plans, term insurance policies have emerged as a great option lately.
Term insurance is a type of life insurance that you take for a certain period of time. It also provides you with a death benefit if you die before the maturity of the plan. There are plenty of benefits that you can get from the best term plan. Term insurance riders are one such essential and highly beneficial component that adds value to your policy.
In this article, we are going to discuss more about these riders and how they can help you.
What Are Term Insurance Riders?
Term insurance plan riders are additional attachments that companies provide, offering superior coverage. Riders are basically added to strengthen your policy apart from core benefits. Most of the companies offer riders on the term insurance. Each rider has a specific purpose and benefit for which you need to add them. There are different terms and conditions for adding these add-ons. While some are already added to your policy, others have to be purchased individually. Either way, it is always beneficial to consider riders while applying for a term policy.
Different Types of Term Plan Riders
Now that you have understood what term riders are, let’s take a look at the different types of riders available:
Accidental Disability Rider: This is one of the most commonly used riders, and as the name suggests, it is a disability benefit that occurs due to an accident. When this rider is added to the policy, the disabled policyholder will be paid for the next 5 to 10 years. The disability should be caused by an accident. It also includes an accidental death benefit, so if the policyholder is the sole income source of a family, death benefits will be provided to the family.
Critical Illness Rider: If the policyholder is diagnosed with a critical illness, when this rider is added, all the medical expenses will be covered. The major illnesses that are covered in this rider include heart attack, paralysis, coronary artery bypass graft surgery, organ transplant, kidney failure, etc. Policyholders need to present an authentic diagnosis report from the hospital or registered testing lab. This rider is largely preferred by elderly people or people who already suffer from health issues.
Waiver of Premium: It is the most imperative and beneficial rider that everyone must think about, especially after the current pandemic situation. With this rider in the term plan, if the policyholder cannot pay the premium due to disability or loss of income, the premium will be waived off. It reduced the burden of the policyholder, but the policy will remain active; all the premium paid before it will be insured. If you think your job profile is uncertain, you must definitely add this rider.
- Income Rider: This rider is helpful after the death of the policyholder. It works as an income generation for the policyholder’s family. With this rider, the family of the policyholder will regularly receive additional income per annum for 5 to 10 years, including the sum assured. Income rider is also a must-have rider that adds more value to your policy. The family will get the death benefit also a regular sum for at least 10 years as income.
The Bottom Line
Before you finalize your term plan, it is important to consider the term riders. These are additional benefits you add to your policy. It is important to understand each rider thoroughly before you add them to your policy; only then will you be able to use them optimally. There are basically four types of riders that you can utilize, and each holds a significant advantage.
The above mentioned was a quick guide to term insurance riders that you must keep handy. Consult your insurance agent, who can help you more in understanding these riders and their perks in your policy.