Which Life Insurance Riders Should You Get With Your Term Life Insurance Policy?
Riders are add-on features offered with life insurance plans, especially with term life insurance policies. While some policy buyers may be aware of riders, many new policy buyers may or may not be.
A term insurance policy comes with relatively simple features. Term insurance riders are available to enhance your policy coverage. They come at a nominal additional cost, and their availability may vary across insurers.
Let’s look at the different riders and how you can choose from the available options.
Riders Available with Term Plans
The availability of riders with term life insurance plans may vary from one insurance provider to another. Before you choose from among the different life insurance riders, consider shortlisting the plans that suit your requirement. If there are any specific term insurance riders that you are keen on, start by looking for plans that offer the ones you seek.
Here are some of the available term insurance riders you can choose from:
- Critical Illness Rider
It is also commonly known as a CI rider. A term insurance plan offers cover for the unfortunate demise of the person insured. However, there are many more situations where the person insured may seek financial support for their family. One such situation is when an individual gets diagnosed with a critical illness. These are the types of illnesses that may need extensive medical care or even hospitalisation.
With this rider, if you are diagnosed with a critical illness covered under a rider, you can claim the benefit provided under the rider. There are several critical illnesses covered by this rider. However, remember that the number and type of illnesses covered under the plan may differ from one insurance provider to another. Some common critical illnesses covered by most term insurance policies include heart disease, kidney ailments and liver disease, among others.
- Accidental Permanent Disability Rider
A serious mishap may lead to permanent disability. While one does everything in their power to avoid such accidents, one should also stay financially prepared against any such possibilities. An accidental permanent disability rider offers you such a cover. When a person buys this rider along with a term life insurance policy, they can claim a benefit if they end up meeting with an accident resulting in a permanent disability. .
- Premium Waiver Rider
There are certain events which may lead to financial difficulties in life. After facing any such events, it might become difficult for you to continue paying your life insurance premiums. This may eventually lead to a policy lapse.
To protect yourself against such a possibility, it may be preferred to get a waiver of premium rider. Also known as a premium waiver rider, it ensures that all future premiums are waived off if the insured person is unable to pay them due to any of the listed conditions in the policy.. The specific details of this rider, such as the conditions, may differ across insurance providers. Ensure that you check the policy, as well as the rider specifications, while purchasing the policy.
- Accidental Death Benefit Rider
If the policyholder were to pass away because of an accident, this rider will ensure that the nominee is paid a sum, besides the sum assured paid as a death benefit, provided the policy is in-force. The untimely passing of a family member, especially a breadwinner, can leave their family in a financial lurch. Also, if the insured person passes away due to any reason other than an accident, the sum assured under this rider is not paid out but only the sum assured under the base term plan is paid out.
Which Rider Should You Choose?
Remember that you are not restricted to choosing one rider per policy. You may choose multiple term-insurance riders provided with a life insurance plan if you like. You may wish to keep a rider-free policy, as well. It is not necessary for you to choose a rider with your life insurance plan. However, it is preferable to add a rider to your term insurance plan as it enhances the coverage under the plan.
Before deciding which riders to choose, keep in mind that riders come at additional costs. So after you choose riders with your term life insurance policy, an additional cost to the premium may be added for the additional riders. You can use a term insurance calculator with a rider option to get estimates of how much the rider may add to your premium.
Besides using a term insurance calculator, you may also consult an insurance agent or a customer service representative of the insurer to get an idea of how the riders will impact your premium.
So, which life insurance riders should you get? To select the suitable rider, the first thing to do is consider your requirements. For example, if you work in hazardous conditions or are prone to accidents like situations, you may opt for the accidental death or disability rider. On the other hand, a waiver of premium rider may also come in handy for most people.
In summary, term insurance plans with riders are a way to enhance your policy and allow you to get more from the same. While you may have to pay for these features, there is a good chance you may end up appreciating what the riders offer. When choosing the life insurance riders, remember to understand your requirement first and ensure that you also understand what the riders offer.
