Do not skip Accidental Death Benefit rider

TomorrowMakers ™

Do not skip Accidental Death Benefit rider

10 August 2015
Incidents of reckless driving and uncertain terrains have made every day travel risky. Road accidents often lead to death or permanent disability and insuring yourself against accidents is indeed a sensible option.

There is one death every four minutes due to a road accident in India. Life indeed is unpredictable.Cover yourself.

A report by the National Crime Records Bureau in India highlights that over 137,000 people were killed in road accidents in 2013 alone.

Incidents of reckless driving and uncertain terrains have made every day travel risky. Road accidents often lead to death or permanent disability and insuring yourself against accidents is indeed a sensible option.

Most insurers offer additional coverage that can be availed along with the base policy. These are called riders. The Accidental Death Benefit (ADB) rider is one of them. Though riders provide additional coverage at a low cost, only 15-20 percent of people who buy insurance opt for riders. This is largely due to the lack of awareness.

Let us see how this rider can benefit you.

Accidental Death Benefit Rider – What does it cover?

ADB rider covers you against the financial risk from a death due to an accident. This is in addition to the sum assured by your existing life insurance policy. In case of your unfortunate death due to an accident, the sum assured under this rider will be paid to your nominee.

Benefits of Accidental Death Benefit Rider

  • Higher cover at low cost

A rider costs much lesser than a standalone policy. IRDAI has capped the rider premium at 30 percent of the base premium. For example, an accidental death benefit cover of Rs. 25 lakhs would cost approximately Rs. 1200 (a year) when purchased as a rider along with a primary policy. The premium varies from company to company and depends on the sum assured, policy term and premium paying frequency. Some companies might also consider age while arriving at the premium payable.

  • Enhanced protection

The ADB rider provides additional coverage in case of accidental death, which will be over and above the base cover.

  • Tax advantage

The rider premium is also eligible for tax benefit as per Section 80C of the Income Tax Act.

So the next time you buy a life insurance policy, do opt for an Accidental Death Benefit rider. Most insurance companies also allow adding riders (as per their underwriting rules) during policy anniversary in case you missed opting for the same during policy purchase.

 
 

MOST VIEWED CONTENT

Secure future parenting – a close look at child plans

Secure future parenting – a close look at child plans

With a variety of child plans to choose from, your children’s dreams can soar, and their educational and financial needs can be fulfilled. Here’s how to choose the most suitable plan for you.

Term vs whole life insurance

Term vs whole life insurance

You’ve decided to provide financial security for your family and subscribe to a life insurance policy, but are stuck in the age-old debate – Term or Whole Life insurance?

Comparison of PPF and life insurance: Which comes first?

Comparison of PPF and life insurance: Which comes first?

Protection first, savings next is the best advice. Your planning should rest on two pillars, protection and saving.

What makes buying life insurance online click?

What makes buying life insurance online click?

From buying mobile phones to placing orders for grocery items Indians are getting hooked on online shopping in a big way. Till a few years ago life insurance was mainly bought offline but now customers are also showing increasing interest in buying life covers online.

Here is how buying term insurance online helps in achieving goals

Here is how buying term insurance online helps in achieving goals

Buying a term plan online is a wise decision and here's why!

Switch Options in ULIPs

Switch Options in ULIPs

Switching options in ULIPs, if used wisely, can help you get the most out of your investments.

Maturity benefits: what you need to know when buying insurance

Maturity benefits: what you need to know when buying insurance

Thought life insurance only gives financial support in case something goes wrong? No. It can grow your money too.

boy

We would love to hear from you!

Question, comment or concern? Our contact form is the best way to get in touch. We will respond to you within 5 working days.

NEWSLETTER