5 riders you should consider while buying a policy

Riders are special features that can maximise policy benefits by bringing flexibility to your coverage, says Yashish Dahiya CEO & co-founder, PolicyBazaar.com.

Before buying a life insurance policy, one generally takes into account limited factors like policy tenure, premium charges and how best the policy coverage is suited to his requirement.

But there could be situations when a general life insurance policy may not be adequate to cover certain life uncertainties.

Hence, it is always advisable to beef up your policy with special features called ‘riders’ which may provide additional benefits when required.

You will incur additional cost to purchase these riders along with the policy depending upon your age and health status.

There are five important riders that can be bought and attached by an individual with his primary life insurance policy.

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Accidental death benefit (ADB) rider

This rider benefits the nominee of the policy holder in case of the latter’s death.

The nominee of the insured is provided an additional amount over and above the normal sum assured as specified at the time of taking the rider.

This provision carries lot of significance in India as number of deaths due to accidents is on the rise.

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Critical illness rider

A typical life insurance policy does not provide cover to meet any medical emergencies but an additional rider in the form of critical illness rider can be bought and added to the primary life insurance policy.  

In case a person suffers from any of the listed critical illnesses such as cancer, kidney failure, liver transplant or any other major organ transplant, heart attack, stroke etc., this rider will provide a sum of money for medical treatment.

Thus, this rider can reduce financial burden on an individual.

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Permanent disability rider

This feature provides regular income in case an insured suffers from permanent disability caused due to an accident.

Thus, this provision pays survival benefit to the insured subject to terms and conditions mentioned in the policy.

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Hospital cash benefit rider

This features provides cash in the event of sudden hospitalisation of the policy holder.

This provision can reduce overheads of the insured.

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Term conversion rider

This rider enables an insured to convert his fixed tenure term life insurance plan to a permanent life insurance policy. The conversion process is smooth without any extra medical test.

While buying a policy along with riders, one must consider various factors such as age, illness and premium charges.

Further, these riders make you eligible for deductions under income tax laws.

For instance, if you opt for accidental death benefit rider, you can get tax deduction under section 80 C on premiums paid while you can get deduction benefits under section 80 D if you opt to buy critical illness rider.

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