Do You Need Add-Ons with Your Term Life Insurance?
Published On Mar 05, 2021, Updated On Apr 22, 2021
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A person needs to have financial protection, and life insurance is one of the most effective tools that can help to achieve that. Anyone who helps a family member (dependent) financially automatically becomes a good choice for a life insurance policy purchase, the basic object of which is to provide your loved ones with financial security in the event of your sudden demise.
Riders are an elective benefit that can be purchased on payment of the extra premium amount along with the insurance policy. By presenting some extra incentives, aside from the main offering of a death payout, riders reinforce an insurance policy. Furthermore, the right set of life insurance riders will benefit the family at the time of claim.
You May Also Like To Read:- What is Accidental Death Rider?
Advantages of Having Add-Ons with Your Term Life Insurance Policy
When you zero-in on the term insurance policy, and the sum guaranteed to better meet your needs, the next move is to consider the available add-ons (riders) so that the benefits can be maximized.
The following are some of the advantages of having add-ons with your term life insurance
1. Allow for Policy Customisation
Getting an add-on rider with the plan allows you to customise the plan if you have a term life insurance plan that provides only basic coverage against the risk of death. You may get increased coverage against a potential risk with the right rider, that may not be covered by your plan.
2. Make Insurance More Economical
Getting an add-on rider removes the need to buy an extra life insurance policy, as stated in the previous point. The resulting advantage one gets is that one does not have to pay higher premiums on a different life insurance policy. In contrast to the premiums owed for a completely functional life insurance contract, the premiums paid to an add-on rider are considerably lower. So, taking an add-on also saves you huge amounts of cash as well, which is always a positive thing.
3. Eliminates the Need for an Additional Policy
There are several risks that life insurance policies offer cover against such as cover against total/partial temporary disability, permanent disability, accidental death, loss of income, critical illness, and many more. Nevertheless, you will rarely find a case where a single policy offers protection against multiple risks. This is where add-ons are important. To get extra coverage, you can apply a rider to your base plan, without having to buy another policy or policies to get the same coverage.
4. Tax Benefits
You enjoy tax benefits on riders just like you would on the basic policy, in accordance with the prevailing tax rules.
An insurance policy rider is a provision or enhancement to an existing insurance policy that offers additional coverage, i.e. extra risk protection. Riders are efficient add-ons that you can opt for to extend life insurance coverage along with your existing term insurance policy at competitive rates. In other words, riders make the coverage of your term insurance comprehensive and broad, covering more than just the finality of demise.