Should You Buy Add-Ons With a Term Insurance Plan?
Updated On Aug 11, 2021
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Term insurance policies are designed to give financial security to family members and help them get through challenging times. You can also add some extra rider advantages to your policy to prepare for specific unanticipated events and cases. These riders are optional additions to the policy that offers additional coverage for the life assured.
Should You Buy Add-Ons with a Term Insurance Plan?
The benefits mentioned below will help you answer the question.
1. Affordable - With the right rider features, you can avoid the costs of obtaining separate insurance for disability or critical illness coverage. Furthermore, you can personalise your term insurance plan by adding riders that correspond to your needs and desires.
2. Additional Coverage - The additional coverage offered by the riders on a term insurance policy can help your loved ones establish a robust financial safety net in the event of a financial emergency.
3. Tax Benefits - Tax deductions and exemptions would help you save money and keep your insurance coverage within your budget. It also assists in saving your hard-earned cash.
Different Rider Options With Their Benefits
Here is the list of various rider benefit alternatives and their advantages.
1. Accidental Death Cover
The insurer is obligated to pay the rider advantage if the life assured passes away in an accident during the rider benefit tenure. In this situation, the accidental death sum is payable in addition to the base sum assured. Furthermore, since the rider option covers unforeseen and unintentional fatalities, the rates are low.
2. Waiver of Premium Benefit
If the policyholder dies while the life assured is still alive, or if the life assured is gravely injured for a considerable length of time due to a permanent or partial disability, the life insurance provider is required to waive all future premium payments due after the date of the accident. Furthermore, the benefits of a term insurance coverage will be enjoyed by the policyholder without policy termination.
3. Critical Illness Cover
If you are diagnosed with one of the major illnesses listed in your term insurance policy contract, such as heart attack, stroke, kidney failure, cancer etc., the insurance company is required to pay out. In this case, the insurer will pay the life assured a lump sum amount of the sum assured. It's also worth noting that the rider benefit, as well as the money associated with it, is only applicable for a brief duration.
4. Permanent and Partial Disability Cover
According to the plan, if the life assured suffers a permanent or partial handicap due to an accident, the life assured will be covered with supplementary coverage. A regular payment of a proportion of the sum assured is made, providing income replacement for 5-10 years. Furthermore, it is important to be aware of the types of accidents that your policy covers, as well as all the terms and conditions that apply to them.
5. Accelerated Death Cover
If the life assured is terminally ill, the insurer will provide a partial advance on the sum assured. In addition, if he/she has less than a year to live, the advance payment might be utilised to cover treatment and other costs. This relieves the financial strain placed on the family due to the expensive medical expenditures for hospitalisation and post-hospitalization care.
The points mentioned above should have convinced you to purchase necessary additional rider benefits with your term insurance plans. Moreover, the advantages listed above emphasize the importance of selecting the right rider after carefully considering your future health demands and requirements.
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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.