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What Is The Benefit Of Purchasing An Accidental Total And Permanent Disability Rider?

Updated On Mar 08, 2022

The Accidental Death Benefit rider and the Accidental Total and Permanent Disability rider are not the same thing. While the former gives a death benefit, the latter provides a lump sum payment in the event of the life assured's total and permanent disability as a result of an accident. In this Article, we will look after the points which show us the benefits of purchasing an Accidental Total and Permanent Disability Rider.

What is an Accidental Total and Permanent Disability Rider?

The Insurance company pays the rider benefit to the life assured if he or she suffers total permanent disability as a result of an accident, compelling the life insured to stop working. The Accidental Death Benefit Rider is frequently combined with this rider. During the Insurance term, the life assured can select whether to receive the rider benefit in one lump sum or in regular payments.

Accidental Total and Permanent Disability Rider's Importance are:

1. Financial Protection

The Accidental Total and Permanent Disability rider provides financial protection to an insured person and their family in the event of a total or permanent disability caused by an accident. The rider sum assured may assist the life assured in seeking prompt treatment for their handicap if the particular individual suffers total and permanent impairment as a result of an accident. If the life is assured or their family is unable to support themselves, this rider can help the individual and their family maintain a reasonable standard of living.

2. Payouts

This rider gives the associated insured individual the option of receiving a lump sum payment or recurring installments as a payout. The rider benefit will be given in a lump sum or in monthly installments if the particular insured individual suffers a total and permanent impairment that prevents them from earning a living.

3. Tax Rebates

The insured individual may be entitled for tax savings under sections 80C and 10(10D) of the Income Tax Act of 1961 if they obtain a term insurance policy. If the premium for a term insurance policy with a rider does not exceed 10% of the base sum insured, the payments can be reimbursed up to Rs. 1.5 lakh. If they purchase an accidental total and permanent disability rider, their tax rebates under Section 80D of the Income Tax Act of 1961 will be doubled.

4. Supplementary Income

If the respective insured individual opts for regular installment payout, the benefit amount can be used as monthly income or a regular source of income for the respective insured individuals as well. The insured person will get a sufficient quantity to support their daily expenses and help their family maintain a decent standard of living. This rider can offer income to the insured person if they are unable to work due to a handicap caused by an unforeseen accident during the policy's term.

5. Cost Effective

The accidental total and permanent disability rider is a low-cost coverage option for an insured individual. This rider's premiums are also quite inexpensive. Individuals and their families have the option of purchasing complete coverage at a modest cost.

Take Away

Anyone's life in today's world is quite uncertain. As a result, adding riders to a normal term insurance policy protects an insured individual's family against financial troubles caused by unforeseen situations. Purchasing an accidental death benefit rider or an accidental total and permanent disability rider with your life insurance policy will benefit you because both riders will come in useful in the event of a financial catastrophe. Individuals should always select riders based on their unique needs in order to provide more protection for their loved ones and assist them in achieving their life goals. 

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.

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