Life insurance riders provide additional benefits to a basic life insurance policy for a small extra premium payment. Common riders include permanent/partial disability riders that pay a percentage of the sum assured if disabled, waiver of premium riders that waive premium payments if disabled, critical illness riders that pay a lump sum if diagnosed with a critical illness, and accidental death riders that pay an extra amount on accidental death. Riders do not change the basic policy benefits and provide additional coverage depending on an individual's needs and other existing policies. Riders may qualify for some tax benefits under Indian law. Customers should evaluate if riders are truly needed based on their personal situation and consult an advisor.

1. Life Insurance Riders:
Are they beneficial?

2. You can choose to add
some extra benefits to
your basic life insurance
cover in your insurance
policy, by paying
additional premium.
These additional benefits
are called insurance
riders.

3. Generally, the extra premium
for the riders is relatively low,
since the extra premium
goes towards covering the
risk mentioned in the rider
and not to savings.
The riders do not change the
basic life insurance plan and
the nominees of the insured
will get that additional Sum
Assured in the event of an
unfortunate death of the Life
Assured.

4. Are life insurance riders
beneficial for you?
It depends on your
personal situation as well
as your other insurance
policies.
Let’s read on…

5. Types of riders we will cover…
Permanent &
Partial
Disability Rider
Waiver or
Premium Rider
Critical Illness
Rider
Accidental
Death Rider
Guaranteed
Insurability
Rider

6. Permanent & Partial
Disability Rider
With this rider, you will get
a certain percentage of the
sum assured on a regular
basis, if you become
permanently or
temporarily disabled due
to an accident and can’t
work.

7. Waiver of Premium
Rider
With this rider, you don’t
need to pay the premium if
you become totally disabled
due to injury or illness and
can't work.
This rider can be particularly
beneficial when the
premium amount is quite
high and helps prevent the
policy from lapsing if you are
unable to pay the premium
due to a disability.

8. Critical Illness Rider
This rider protects you in the
event of a critical illness.
This rider pays out a
lumpsum amount if the
insured is diagnosed with any
one of the illness specified in
the policy.
Generally, the extra cover is
equal to the sum assured on
the base policy and is paid
upon diagnosis of the illness.

9. Accidental Death
Rider
With this rider the insured
gets an extra amount, in
addition to the sum
assured, if an accident
results in the death of the
insured. This is applicable
ONLY if the cause of death is
an accident.
However, if the sum assured
in the basic policy is
adequate for the needs of
the family of the insured,
then the insured need not
buy this rider.

10. Guaranteed
Insurability Rider
This rider allows the
insured to buy additional
life insurance coverage
at a later date without
the need for further
medical examination or
without providing any
evidence about
insurability.

11. The usefulness of these Riders
will depend on your personal
situation as well as your other
insurance policies, such as an
Accidental Insurance Policy,
Health Policy, Critical Illness
Policy, etc.
Remember, riders come
at a cost.
So ask yourself or consult a
financial adviser if you really
need the rider.
Do you really
need a Rider ??

12. Tax Benefits of
Riders
Riders (other than Critical
Illness & Waiver of
Premium riders), get tax
benefits under Section
80C of the Income Tax
Act on premium
contribution of up to Rs
1.50 lac per year

13. Additionally, the
premium paid for the
Critical Illness Rider and
the Waiver Of Premium
Rider qualifies for
deduction from the
taxable income under
Section 80D of the
Income Tax Act up to
the limit of Rs 15,000
(Rs 20,000 for Senior
Citizens).

14. Now that you know the useful Riders
available, you may consider adding
these to your new life insurance
policy.
Riders like Permanent or Partial
disability and Accidental Death are
useful at almost any age.
Whereas Critical Illness, Waiver of
Premium and Guaranteed
Insurability riders are more useful as
the insured approaches the middle
age.

15. Happy Investing!
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