Life Insurance (5)
Accidental Disability and/or Dismemberment Rider: You could insure against disabilities arising out of an accident by opting for this rider. In case of an accident resulting in total or partial disability/dismemberment during the term of your base policy, a Rider Sum Assured will be paid out to you while your base life insurance policy continues to provide you with a life cover. Though some companies offer a disability benefit only in case of permanent disability; there are riders that offer permanent and partial disability benefit in the event of an accident (with certain clauses that vary for every insurer). This can be an important risk cover to mitigate the financial hardships associated with a sudden and unforeseen accidental disability.
Critical Illness Benefit Riders: This rider provides coverage against certain critical illnesses. Though the number and type of diseases covered under these riders are limited, yet the one’s covered, like cancer, coronary artery bypass, heart attack, kidney/renal failure, major organ transplant and paralytic stroke etc.; are those with fairly high associated medical treatment and hospitalization costs.
One of the attractive features under the critical illness benefit rider is that the policy holder gets an amount equal to the sum assured irrespective of the medical expenses on or after the diagnosis of the critical illness.
The critical illness rider is terminated once a critical illness is diagnosed. In some cases, the insurer will make a payment of sum assured for the critical illness rider with the main policy and terminate the underlying base policy. A plan that continues to give an insurance cover while charging a marginally higher premium, is always better than the one’s which terminate the base policy once a claim is made on the rider.
Hospital Cash Benefit Rider: This rider provides coverage for payment of medical bills paid on hospitalisation, subject to conditions and exclusions in the policy. The insurer compensates the insured for a fixed amount for each day of hospitalisation, subject to a maximum sum assured under the rider. Unlike the critical illness rider, the hospital cash benefit rider is not terminated on a claim being made; and can continue subject to the annual limit of the sum assured.
Level Term Cover Rider: This particular rider provides you the option to enhance your risk cover for a limited period up to a maximum sum equivalent to your base policy. It basically offers a death benefit only and helps the survivors to pay any unforeseen expenses or clear off all the liabilities of the policy holders. If you do not have adequate term insurance coverage and are in the process of buying a savings oriented or endowment plan, then you may want to consider this rider.
Double Sum Assured Rider: In case of an ill-fated death of the policyholder, this rider provides for an additional equal amount corresponding to the basic sum assured. As compared to opting for a larger endowment policy, you could double your life cover at a nominal cost with this rider.