The Benefits of Life Insurance Riders

Life Insurance Riders - Are They Your Family's Shield?

Do you know that your life insurance policy can be like a fortress? This fortress can protect your family from future financial storms. But do you know that the walls of this fortress can be made even stronger? Yes, through life insurance riders!

What are life insurance riders?

You must have noticed that many times you download an app on your mobile phone. But do you manage with just the basic app? No, right? You also add additional features to increase its functionality. In the same way, life insurance riders also act as an additional protection shield in your basic life insurance policy.

In simple words, these are optional coverages that you can add to your existing life insurance policy with a little extra premium. These riders increase the scope of your policy and provide financial assistance to your family from unforeseen events.

Why are riders necessary?

Suppose, you have taken a term life insurance policy. This policy will provide financial assistance to your family in case of your unfortunate demise. But what if you survive an accident, but become completely disabled? In such a situation, your source of income may end.

This is where riders help you. You can add an "Accidental Disability Rider" to your policy. This rider will provide a lump sum amount to your family in case you become completely disabled in an accident. This will keep your family financially strong.

Benefits of Riders:

Additional protection cover: Riders increase the scope of your basic life insurance policy and provide financial assistance to your family from unforeseen events.

• More benefits at less cost: Riders are usually very affordable. You can make your policy more comprehensive with a little additional premium.
• Customisable: You can add or remove riders from your policy to suit your changing needs.
• Tax benefits: You may also get income tax exemption on the premium of many riders.

Types of Life Insurance Riders

Now that you know what life insurance riders are and why they are important, let's take a look at the different types of riders.

1. Critical Illness Rider:

This rider provides you with financial assistance in case of critical illnesses that are life-threatening. These include cancer, stroke, heart attack, etc. With this rider, you will receive a lump sum amount upon diagnosis of the illness.

2. Disability Rider:

This rider provides you with financial assistance in case of an accident or illness that affects your ability to work. It includes two types of riders:

• Accidental Disability Rider: This rider provides a lump sum amount in case of complete or partial disability due to an accident.
• Disability Income Rider: This rider provides you with a monthly income so that you can maintain your lifestyle. 

3. Waiver of Premium Rider:

This rider gives you relief in case you become unable to work due to an illness or accident and cannot make premium payments. With this rider, your policy will remain active as long as you are unable to work, and you will not be required to make premium payments.

4. Term Rider:

This rider provides you with additional coverage, thereby increasing your policy term. For example, if your policy term is 30 years and you add a term rider at the age of 25, your policy term will increase to 55 years.

5. Additional Expenses Rider:

This rider provides you with financial assistance for additional expenses incurred due to a critical illness or accident. These expenses may include medical care, medicines, travel, etc.

6. Retirement Benefit Rider:

This rider provides you with a lump sum amount at the end of the policy, which you can use for your retirement planning.

What to consider while choosing riders?

• Your needs: Assess your lifestyle, financial situation and family requirements.
• Budget: Make sure you can afford to pay the additional premium for the riders.
• Policy terms: Read the rider terms carefully, especially the extent of coverage, waiting period and inclusions-exclusions.
• Agent advice: Consult a trusted agent who can help you choose the riders that best suit you.

How is Rider Premium Determined?

The premium of riders depends on several factors. These factors are as follows:

• Age: Generally, the premium of riders increases as you grow older. This is because as you grow older, the risk of falling ill also increases.
• Health: Your health status also plays an important role in determining the premium of riders. If you suffer from any disease or have a history of health issues, your rider premium may be higher.
• Type of rider: Different types of riders have different premiums. Some riders have higher premiums because they are more risky.
• Amount of coverage: The higher the coverage amount you choose, the higher the premium you will have to pay.
• Term of policy: The term of the rider also affects the premium. Longer-term riders have higher premiums.
• Policy issuer: Different insurance companies determine different premium rates for riders.

How to avail riders?

To avail riders, you need to follow the following steps:

• Start the claim process: Whenever you have to make a claim under the rider, you need to inform the insurance company and submit the required documents.
• Submit documents: You need to submit proof of illness or accident, medical reports, and other required documents.
• Follow the claim process: You need to follow the process prescribed by the insurance company. This may include checking of documents, verification, and calculation of the claim amount.
• Receive claim amount: Once your claim is accepted, you will receive the claim amount within the time frame prescribed by the insurance company.

Some important things about riders:

• You need to pay an additional premium to add riders to your policy.
• The premium of riders is usually affordable and can suit your budget.
• Riders help you keep your family financially secure from unforeseen events.
• The claim process for riders is usually simple, but you need to submit all the required documents and follow the process prescribed by the insurance company.

Importance of Riders for Your Family

Riders are extremely important for you and your family as they help keep you financially protected from unforeseen events. Here are some of the key benefits of riders:

• Financial protection: Riders help keep your family financially secure in case of a critical illness, accident or unexpected death.
• Lifestyle protection: Riders help you maintain your lifestyle, especially if you become unable to work due to an accident or illness.
• Retirement planning: Some riders provide you with a lump sum amount at the end of the policy, which you can use for your retirement planning.
• Peace of mind: Riders give you the assurance that your family's financial needs will be met, giving you peace of mind.

What to consider while choosing riders?

• Your needs: Assess your lifestyle, financial situation and family requirements.
• Budget: Make sure you can afford to pay the additional premium for the riders.
• Policy Terms: Read the rider terms carefully, especially the limits of coverage, waiting period and inclusions-exclusions.
• Agent Advice: Consult a trusted agent who can help you choose the riders that best suit you.

Conclusion

Life insurance riders are an important safety net for you and your family. They help keep you financially protected from unforeseen events and meet your family’s future needs. So, consider adding riders to your life insurance policy and ensure your family’s safety.

Now that you have gained important information about life insurance riders, you can strengthen your and your family’s safety by adding riders to your policy.

Common Questions and Answers About Riders

Question 1: Can I add riders to my existing life insurance policy?

Answer: Yes, you can add riders to your existing life insurance policy. However, some insurance companies offer riders only when you buy a new policy. So, make sure to check with your insurance company.

Question 2: Do riders have to be paid in lump sum for the entire policy term?

Answer: No, riders' premiums are usually paid at regular intervals, such as monthly, quarterly or annually. It depends on the premium payment option you choose.

Question 3: Can I remove riders from my policy?

Answer: Yes, you can remove riders from your policy. However, you may face a change in premium if you do so. It depends on the type of rider you remove and the terms of your policy.

Question 4: Does the coverage of riders also apply to my family members?

Answer: It depends on the type of rider. Some riders, such as the Critical Illness Rider, provide coverage only for you. While other riders, such as the Accidental Disability Rider, may provide coverage for your family members as well.

Question 5: Can I add more than one rider to my policy?

Answer: Yes, you can add more than one rider to your policy. This will provide you with more comprehensive protection. However, note that for each rider you will have to pay an additional premium.

Question 6: Is there a time limit to claim for riders?

Answer: Yes, there is a time limit to claim for riders. This time limit depends on the type of rider and the insurance company's policies. So, make sure to check with your insurance company about the time limit required to make a claim.

Question 7: Do riders offer tax benefits?

Answer: You may get income tax exemption on the premiums of some riders. This depends on the tax laws of your country. Therefore, it is advisable to consult your tax advisor about tax benefits.