Advantages of Adding Riders To Your Term Plan

Have you ever wished to have an insurance plan with a wide coverage? A plan that covers everything including emergency hospitalization to cashless treatment to funding your child’s higher studies to benefits even after your death, of course every investor wishes for it but is in a misconception that great benefits come at a greater premium cost. We often come across term plans with great offers but hesitate in investing thinking it might be expensive but that is not the truth.

Insurance riders have got your back. Riders are additional extra benefits included in a life insurance policy, they could be tied to the base/primary policy as well and when they're attached, they kick in when a certain mishap happens and give financial protection over and beyond the basic sum assured. Riders can be added to any type of insurance plan, including term, endowment, money back, and unit-linked.

Advantages Of Adding Riders To Your Term Plan 

With a little more carefulness and information you can add riders to your insurance policy and get more coverage and protection for your future. Here are some of the advantages of adding riders to your term plan-

• It Eliminates The Need Of Having Multiple Policies

A term insurance policy may offer a large sum assured, it may not be sufficient to cover all of your future needs. You don't have to go through the hassle of getting a new policy just to bridge the gap by selecting appropriate riders. You won't have to choose between different stand-alone policies if you have a rider.

• It Provides You With Tax Benefits

Section 80C of the Income Tax Act allows for the deduction of life insurance premiums. Additional deductions under Section 80D of the Income Tax Act are available if you choose a rider for medical reasons. Choosing a medical rider can result in a deduction of up to Rs. 25,000. This feature adds to the comprehensiveness and quality of your plan.

• It Covers Accidental Death And Disability And Critical Illness

While your specific term plan might not cover mishaps like accidental disability and critical illnesses such as cancer, you can always choose a rider which covers accidental death and disability so that you and/or your loved ones receive the financial support when you’re not in a position to handle your finances. 

• It Provides Enhanced Protection And Greater Coverage

The main motive of adding a rider to your term insurance policy is to protect your family's future. A term plan's death benefit is sufficient, but it will be useless if you meet an accident that leaves you disabled to maintain your family financially. When riders are added to a term plan, they provide significantly more protection against accidents, disability, and job loss.

Riders safeguard you against all possible mishappenings. 

• It Comes With The Benefit Of Premium Waivers

The risk covered by additional riders aids in providing financial assistance if the policyholder becomes ill or disabled due to any accident. These circumstances will not force you to cancel your insurance policy due to the lack of funds, you will instead be entitled to a waiver.The premium waiver benefit saves your policy and allows the insurance plan to continue without you having to pay premiums.

• It Reduces Management Hassles

If you keep purchasing new insurance policies to increase your protection, you will have to pay additional premiums and deal with multiple policies as well.While insurance riders coexist with the base life insurance coverage to make your plan much more rewarding with additional benefits. When compared to stand-alone policies, it makes your plan a little more expensive but much more rewarding in the longer term in terms of benefits and security. 

Take Away

Buying additional riders for your term plans can be a little costly but is definitely better than handling multiple policies with bigger risks. Plan carefully and invest your money in riders to ensure you get the most of your term plan even in adverse times.

Also read 

What are the Rider options with a Life Insurance Plan?

All About Waiver of Premium Rider

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.