Riders are an add-on to the life insurance policy, providing additional benefits at nominal extra cost. A term insurance plan essentially provides income loss protection in the event of death of the life assured, which enables life assured’s family to continue their life goals journey. Whereas adding riders to your term insurance plan will help in getting additional cover for contingencies like critical illness or disability etc. In essence, riders help in maximizing the benefits of your term insurance cover. This enables policyholder to continue their life cover and provide financial security to their family for achieving their goals.

Today, one can choose from a variety of riders such as Waiver of Premium rider, Accidental Death Benefit rider, Accidental Permanent Total/Partial Disability rider, critical illness rider, etc.

Let’s look at some of the riders available with term insurance policies:

1. Accidental Death Benefit Rider: Under this rider, if the policyholder loses his/her life in an accident, an additional sum which is assured under the rider is paid out over and above the base policy sum assured. For example: Consider a policyholder who buys a term insurance policy of Rs. 80 lakhs and he/she also opts for an Accidental Death Benefit rider of 20% of sum assured. In this case, if the policyholder dies due to an accident, the dependents get Rs 80 lakh plus an additional 20% of Rs 80 lakhs i.e. 16 lakhs. So, they get a total of Rs 96 lakhs. This additional sum ensures your loved ones continue pursuing their life goals without worrying about future finances.

2. Critical Illness Rider: With this policy rider, the life assured receives a lump sum on diagnosis of a critical illness that is covered under the rider. The objective of this rider is to provide the life assured with a lump sum amount that can help them get the medical treatment arising out of the critical illness, as well as ensure that the burden of the unexpected medical bills doesn’t derail life assured ‘s life goals.

3. Waiver of Premium Benefit Rider: If a policyholder is unable to pay the premium due to a contingency such as death, critical illness or permanent total disability arising out of an accident, a Waiver of Premium Benefit rider ensures that all future premiums of the term insurance policy are waived off. This means that the term insurance policy will remain active until the policy expires and life assured or the family members will not have to pay any future premiums until the policy expires. It is taken care of by the life insurance company, thus offering an additional security to your life goals.

4. Accidental Permanent Total/Partial Disability rider: Through this rider, a sum is paid to the life assured in the case of a total or partial disability caused by an accident. Since the life assured is unlikely to meet medical expenses and further reduction in their earning capacity, the insurance company makes up for their loss of financial wellbeing by compensating them with a pre-agreed proportion of the total sum assured.

5. Family Income Benefit Rider: Under this rider, on contingent event as defined in the terms and conditions, his/her family receives 1% of the rider sum assured every month for the remaining rider term subject to a minimum of 10 years. This enables your family will receive a regular monthly income, in absence of your income, thus helping them meet day-to-day expenses and also keeping their life goals on track.

Buying riders with your basic term plan is a good way to protect your family from any financial roadblocks arising out of unexpected events. Choose riders as per your need, and provide additional comprehensive security to your loved ones for meeting their life goals.