6 Important Term Insurance Riders and their Benefits

A rider is a provision under an insurance policy to let you add more benefits to a basic term policy to get extra coverage. It increases the monthly premium marginally. But what you get in return is added financial coverage that comes in handy in times of need. Following are the most common riders added to a term plan. Read on to choose one or multiple riders!

#1 Accidental Death Benefit Rider

You can add the accidental death benefit rider to the best term insurance plan. As the term implies, when the policyholder dies because of an accident, the sum assured in this rider goes to the beneficiary. The policyholder must pay an additional and fixed premium every month to get this rider.

The beneficiary will only be entitled to the sum assured when there are no riders in the policy. But, at the same time, they might not get the sum assured if the policyholder dies from an accident and there is no accidental death benefit rider.

#2 Accelerated Death Benefit Rider

If the policyholder falls terminally ill, then it puts a lot of financial pressure on the family. With the ever-increasing cost of medical bills and hospitalization, the family must arrange a hefty sum in a short time. Keeping an Accelerated Death Benefit Rider in the best term insurance plan is helpful in this regard. It will let the family get a portion of the sum assured in advance.

#3 Accidental Disability Benefit Rider

This rider is helpful when a policyholder has an accident that makes them partially or permanently disabled. Think of this as an income replacement rider that pays a specific sum of money regularly to the policyholder for the next couple of years. However, any disability due to self-inflicted injury is not covered under this rider. It only covers disability due to accidents.

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#4 Critical Illness Benefit Rider

Critical illness riders offer extra financial aid if the policyholder suffers from a critical illness that makes them stop working. When the person is bedridden due to a critical illness, the family must deal with day-to-day expenditures and medical bills at the same time. At least, when this rider comes into effect, the family has a way to replace the income.

#5 Income Benefit Riders

It is a rider that offers additional financial support to the beneficiary of the policyholder after his untimely death. Along with the sum assured, the beneficiary gets an additional amount as a monthly income for a period of five to ten years. This is another income replacement option under a term plan.

#6 Waiver of Premium Rider

If the policyholder faces a loss of income due to a critical illness or permanent disability, then all the pending premiums are waived off by the insurer. The insurance company considers the premiums to be paid in full and does not mark the policyholder as a defaulter. This rider helps because the policyholder might be unable to pay the rest of the premiums for certain reasons. At least, they will not lose the policy benefits and get the policy lapsed if this rider is present.

These are the six important riders that you can add to your term policy. Of course, you can add other riders but choose at least one or two from the list above.

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