What are Riders in Life Insurance?
Life insurance provides financial security to the insured in form of
maturity amount or death benefit to the designated nominee. Riders are
optional add-ons to life insurance policies to accentuate the benefits.
Riders add extra financial security measures that ease through difficult
times. Riders can only be added at inception or anniversary of life
insurance policy and are for certain time period. Riders are available
at relatively lost cost and their utility is great.
The major riders available with life insurance policies are:
Level term rider: This rider adds additional Sum Assured other than life insurance cover that is given to the nominee on demise of person insured. Since it works as term plan, level term rider is very cheap.
Accident Death and Disability rider: This rider pays the stipulated amount if the insured is involved in an accident. Generally amount equal to life insurance policy Sum Assured is paid to the beneficiary if the insured dies because of accident. And if the insured suffers any temporary or permanent disability, a portion of Sum Assured is given to the insured for recovery.
Critical Illness rider: This rider pays the chosen amount if the insured is diagnosed with any of the critical illnesses like cancer, stroke etc. It’s generally a lump sum amount paid to the insured to take his treatment as per his preference.
Waiver of Premium rider: This rider waives all the future premiums that are to be paid by the insured if he suffers from disease or passes away. The life insurance policy continues for the rest of period and the maturity amount is paid at the end of policy period to the concerned person.
Family Income Benefit rider: This rider pays regular monthly or yearly amount to the nominee in case of death of life insured.
Level term rider: This rider adds additional Sum Assured other than life insurance cover that is given to the nominee on demise of person insured. Since it works as term plan, level term rider is very cheap.
Accident Death and Disability rider: This rider pays the stipulated amount if the insured is involved in an accident. Generally amount equal to life insurance policy Sum Assured is paid to the beneficiary if the insured dies because of accident. And if the insured suffers any temporary or permanent disability, a portion of Sum Assured is given to the insured for recovery.
Critical Illness rider: This rider pays the chosen amount if the insured is diagnosed with any of the critical illnesses like cancer, stroke etc. It’s generally a lump sum amount paid to the insured to take his treatment as per his preference.
Waiver of Premium rider: This rider waives all the future premiums that are to be paid by the insured if he suffers from disease or passes away. The life insurance policy continues for the rest of period and the maturity amount is paid at the end of policy period to the concerned person.
Family Income Benefit rider: This rider pays regular monthly or yearly amount to the nominee in case of death of life insured.
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