All people across societies slowly realize the necessity of having a life cover. Especially with life increasing its pace and uncertainties rising by the day, every family needs a life insurance cover. It allows them to deal with the loss of a loved one, without the stress of managing finances in such sensitive times.
Presume you are the only breadwinner of your family. And one day, due to some unexpected circumstances, you are not around them anymore. How will your family cope up with the living expenses? Well, a simple answer would be life insurance. Having life insurance will ensure that your family is financially stable and capable enough to look after themselves in your absence.
Most life insurance policies provide a death benefit to the beneficiaries in case the insured is not around. Moreover, they will enable them to pay off the loans and debts and maintain a decent living standard.
And to ensure that you get the best plan, insurance providers are coming up with plans that cater to different individuals' varying needs. Sometimes it might appear challenging to choose the right plan in such a complex marketplace. Thus, to buy the best life insurance plan, you should understand the life insurance meaning and investigate each type's pros and cons. Also, it will be wise to evaluate your needs before you buy a life insurance plan.
For instance, when you research life insurance plans, you will find that there are riders that you can add to your primary plan. These riders are an attachment or endorsement that gives you supplementary coverage. It strengthens your life insurance plan by providing additional benefits, apart from the core offering of a death benefit.
Some of these riders that offer different benefits are:
1. Accidental Death Benefit Rider
In case, during the policy term, an unforeseen event leads to your demise, this rider will pay an additional sum assured. Generally, this additional sum is calculated on the original sum assured and may vary from insurer to insurer. However, this rider's premium remains fixed for the entire policy term.
However, there is a misconception associated with this rider. It states that you will receive the sum assured only if the accident is the cause of death and not otherwise. Well, that is not true.
Even if you do not have the rider, the basic sum assured will be given to your beneficiaries. This rider simply promises an additional sum over and above the basic sum assured. Therefore, before you buy an insurance plan, it will be wise to check if this rider is suitable for you or not.
2. Critical Illness Rider
When you choose to buy life insurance, make sure that you consider the critical illness rider. It will pay you a lump-sum amount on a valid diagnosis of a critical illness pre-specified in the policy. Generally, cancer, heart attack, paralysis, kidney failure and others are ailments covered under this rider.
After the detection of the critical illness, the policy may either continue or terminate as per the policy terms and conditions. Thus, it is vital to read the policy terms to understand the rider's exact terms and conditions before buying life insurance.
3. Waiver of Premium Rider
Before you buy life insurance, you should definitely consider this rider. Under this rider, it is assured that if you are unable to pay future premiums due to low-income loss or disability, those premiums will be waived off. Plus, a significant advantage is that the policy will remain active.
However, supposedly you are disabled in the future or face income loss and cannot pay the premium; the policy will expire without this rider. Moreover, no death benefit will be paid due to non-payment of due premiums.
4. Disability Rider
In case you meet with an accident and are rendered partially or permanently disabled because of it, this rider comes into force. The inclusion of this rider with the life insurance you buy will enable you to get paid regularly for the next five to ten years following the accident. This amount will be paid in a certain percentage of the sum assured.
This disability rider can be relied upon as an income source. It is crucial to note that this rider comes into force only if the cause of the disability is an accident.
As per this report, there is a growing interest in insurance among people due to innovative products. But before you buy life insurance, you should check the add-ons that are allowed and available. And it will be beneficial to understand the riders in detail before you include them in your life insurance plan.
If you did not know life insurance meaning before, it could be stated that the above information will help you understand it in detail. And to make your life insurance buying job easier, reliable insurers provide premium calculators on their websites. You can compare plans and check the premium to be paid according to your suitability before buying life insurance.