In Term Insurance, the critical illness riders are valuable riders that extend funding to the policyholders in the event of being diagnosed with one of the critical ailments listed by the term insurance provider in the policy document. When looking for the Best Term Insurance in India, it becomes important to look for a term plan that not only provides life coverage, but also secures against critical illnesses. There are mainly two types of critical illness riders that are offered, namely:
- Standard critical illness riders: Here, a policyholder receives a substantial amount over & above the sum assured when diagnosed with any of the listed critical diseases.
- Accelerated critical illness riders: Here, a policyholder receives access to the fund that can be used at the discretion if diagnosed with a critical ailment. The funds received are a part of the base coverage amount, which means the beneficiary should expect a reduced amount in case the insurer disburses the death benefit.
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Who Should Buy a Term Insurance with Critical Illness Rider?
Provided below is a list of people who can consider buying the term insurance with critical illness benefits:
- Self-Employed Individuals
Term insurance with a critical rider is helpful for self-employed individuals who may not have enough savings to spend on medical expenses & whose work profile is unpredictable.
- Individuals with Limited Savings
Term insurance with a critical rider is helpful for individuals who have lesser savings. It will help them meet medical emergency-related expenses & fulfil their financial goals.
- Individuals with a Family History of Critical Illness
Term insurance with a critical rider is helpful for individuals who have a family history of illness & are more prone to family conditions. It will provide the individuals with the peace of mind & the support required.
- Family Breadwinners with dependents
Term insurance with a critical rider is helpful for individuals who are the breadwinners of the family. They have varied financial responsibilities, which can be met by critical illness benefits.
- Individuals above 40
Term insurance with a critical rider is helpful for individuals who are over 40 years of age & more prone to suffer from critical illness diseases.
Things to be considered while buying a Term Insurance with Critical Illness Cover
Choosing the best plan from different Types of Term Insurance with critical illness coverage fulfills the financial security. Hence, to safeguard the financial future of all family members, one should consider the mentioned things before buying a term plan with critical illness:
- The amount of the sum assured will be received by the policyholder’s nominees in case of the sudden demise of the insured.
- When a critical illness included in the plan is diagnosed, the benefit paid will be equal to the amount rider sum assured.
- As there is no minimum requirement as to duration of the survival, the amount of benefit will be paid during the time of the 1st diagnosis itself.
- Each term insurance will include a coverage against critical illness & terms & conditions.
- These features help enhance the chances of policyholders’ survival at an added cost.
- One should be well aware of the waiting period to avoid any miscommunications.
- Get benefits of taxation under sections 80C & 80D of the Income Tax Act, 1961.
- The payment can be made in a single lump sum, or regular installments for a limited period, or a whole life term plan.
Diseases Covered in a Term Insurance with Critical Illness Riders
Provided below is a list of diseases covered in a Term Insurance with Critical Illness Riders:
- Angioplasty
- Heart Valve Surgery
- Myocardial Infarction
- Open Chest CABG
- Cancer
- Blindness or Deafness
- Muscular Dystrophy
- Head Trauma
- Bone Marrow Transplant
- Chronic Liver Disease
- Neuro Diseases with permanent symptoms
- Aplastic Anaemia
- Brain Tumour
- Coma
- Stroke
- Paralysis
- Lung Failure
- Major Burns
- Kidney Failure
- Poliomyelitis
- Loss of Limbs
- Parkinson’s disease
Diseases Not Covered in a Term Insurance with Critical Illness Riders
Provided below is a list of diseases that are not covered in a Term Insurance with Critical Illness Riders:
- Disease diagnosed or treated by a doctor within 48 months just before the plan started or renewed
- Self-inflicted injury
- Suicide
- Illegal acts with criminal intent
- Sexually Transmitted Diseases
- Use of drugs or alcohol not prescribed by a doctor
- Non-commercial aviation activities
- Injuries from specific activities like hunting, professional sports or scuba diving
- War
- Donor treatment for organ replacement
- Criminal acts
- Radioactive contamination from a nuclear accident
- Illnesses diagnosed before age 17 due to congenital disabilities or diseases
Eligibility Criteria
Provided are the eligibility parameters that are to be met to buy a term plan with critical illness cover:
- The minimum age to buy a term plan with critical illness rider is 18 years.
- The maximum age to buy a term plan with critical illness rider is 65 years.
- Some insurance companies also require medical tests & a present health condition while analysing the eligibility criteria. This is because any pre-existing ailment will have an impact on the premium & coverage amount.
- Also, some insurance companies require medical underwriting, i.e., medical tests, health-related questionnaires, & evaluation of medical records.to assess the risks.
How to Buy a Term Insurance with Critical Illness Rider?
There are two ways to buy term insurance with a critical illness rider:
- Online Mode:
- Visit the website of the insurance company.
- Apply for a term insurance plan with a critical rider.
- Fill out the online application form.
- Submit the relevant documents.
- Pay the premium amount via any of the digital modes that an insurance company has allowed.
- Submit the application.
- The insurance application will be processed, & coverage will be allowed.
- Offline Mode:
- Visit any nearest branch of the insurance company.
- Speak to an insurance agent.
- Fill out an application form.
- Upload the required documents & pay the premium amount.
- Submit the same to the insurance company to underwrite it & issue the coverage amount.
Conclusion
Term insurance with critical illness coverage offers an additional benefit over & above the death benefit at an added cost. This plan helps insured people get rid of the financial stress related to medical treatment costs.
