What is a term insurance rider?

A term insurance policy is a type of insurance plan that offers financial security to the family of the insured, in case of his/her death. The benefits of a term insurance plan are many. Apart from high coverage at low premium rates, a term insurance policy also offers you additional privileges in the form of term insurance riders.

What is a term insurance rider?

A term rider is an add-on benefit you can attach to your existing term insurance policy at a nominal rate. A term rider offers you additional benefits over and above the pre-decided sum assured of your policy, in case a scenario that is covered by the rider occurs.

Taking a look at the different types of term insurance riders by Aegon Life will help you get a better understanding of how these work.

 Critical illness rider

The critical illness rider pays the policyholder 100 percent of the rider sum assured, in case the insured is diagnosed with any of the below mentioned diseases:

  1. Cancer (except skin cancer)
  2. Coronary artery bypass graft (CABG)
  3. Heart attack
  4. Stroke
  5. Kidney failure
  6. Paralysis
  7. Major organ transplant
  8. Heart valve surgery
  9. Surgery for an aorta-related disease

 Disability rider

The disability rider pays the policyholder a lump sum amount upon disability due to an accident or sickness where:

  1. 100 percent of the sum assured is paid upon loss of or loss of use of both limbs, or loss of eye sight
  2. 50 percent of the sum assured is paid upon loss of speech, loss of hearing in both ears, or loss of or loss of use of any one limb

This rider also waives off any further premiums on the base plan upon disability. This means your policy continues to remain active without any future premium payments.

Accidental Death (AD) rider

In case the policyholder passes away due to an accident, the policy’s nominee receives the death benefit, as per this rider. The death benefit is a minimum amount of INR 1,000,000 and a maximum amount that is equal to the sum assured of the policy’s base plan.

Accidental Death, Dismemberment and Disability(ADDD) rider

This rider by Aegon Life covers accidental death, accidental dismemberment, and accidental total permanent disability where:

  1. In case of accidental death, 100 percent of the sum assured under this rider is received.
  2. In case of accidental dismemberment, 50 percent or 100 percent of the sum assured under this rider is received, depending on the severity of the loss.
  3. In case of accidental total permanent disability, 100 percent of the sum assured under this rider is received.

 Waiver of premium rider

This rider waives off any further premiums to be paid in case of a critical illness or disability. For example, Aegon Life’s iCancer plan comes with an inbuilt rider that waives off future premiums if the insured is diagnosed with major stage cancer. Similarly, the iSpouse policy has an inbuilt rider that waives off future premiums if one of the spouses is diagnosed with a terminal illness.

Women’s critical illness rider

This rider by Aegon Life covers women-related illnesses and medical conditions like:

  1. Malignant cancer of the female organs
  2. Birth of child with a congenital disorder
  3. Complications during pregnancy

Here, a percentage of the sum assured is paid if the insured is diagnosed with diseases or medical conditions pre-specified under this rider.

Attaching a rider to your term insurance policy ensures that you get a larger sum assured at an affordable rate. It provides your family with additional financial security and gives you complete peace of mind.

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