Term insurance can provide a sum assured to a policyholder’s family in case of an unfortunate event. However, such policies don’t cover all types of risks. Hence, to get the most benefits, a policyholder can opt for riders.
Read on to know how you can customize your term insurance plan to make it more beneficial.
Term insurance plans offer a sum assured to the policyholder’s family if he/she passes away during the tenure. However, there are various risks that a term insurance policy doesn’t cover. Therefore, it isn’t wise to rely solely on traditional term insurance. But there are riders that can provide more protection to a policyholder.
Riders are benefits that a policyholder can buy. He/she can opt for them by paying additional premiums. Such riders can increase the cover and make the policyholder more secure.
Let’s take a look at some of the add-ons that can help a policyholder-
- Accidental Death Benefit Rider
If the policyholder passes away due to an unfortunate event, such as an accident, then along with the normal death benefit, the accidental death benefit rider is also paid to the beneficiaries. Therefore, the policyholder’s family can get higher financial cover.
- Waiver of Premium on Critical Illness
In case the policyholder purchases this rider, then the insurer will waive off the future premiums payable for the insurance policy if the insured person gets diagnosed with a critical illness. Furthermore, the life cover and any other riders, if purchased, will continue.
- Term Assurance Rider
This add-on provides additional benefits along with term insurance. It increases the life cover. The insurance company can offer a lump sum payout or monthly payouts.
- Critical Illness Rider
If the policyholder’s family has a history of any critical illness, then he/she should add this rider. This is because critical illnesses aren’t covered in term insurance policies. If a policyholder purchases this rider, then he/she can get financial assistance for the treatment in case he/she is detected with a critical illness.
- Guaranteed Insurability Option Rider (GI)
Insurance requirement might change based on the policyholder’s needs. Therefore, a policyholder might want to enhance his/her life cover. This add-on can allow the insured person to purchase additional insurance in the future if he/she wants to.
- Waiver of Premium Rider
There might be situations that can make a policyholder unable to pay premiums. If the premiums aren’t paid, then the insurance policy will not be valid. For example, if a policyholder is hospitalised, then he/she might not be able to pay the premium. However, with the waiver of premium rider, the policy will stay active in case the policyholder fails to make the payment due to an unforeseen event, such as a medical emergency.
Apart from selecting the life cover, it is also essential to choose the right add-ons. This is because these add-ons will provide you with an additional cover that can help you. It is wise to add covers based on your requirements as it can provide you with additional benefits.