Home / Money / Personal Finance /  Is it good to buy disability rider with term insurance?

I am 27 years old & I already have a health and term life insurance in place. For more comprehensive coverage I would also like to buy a disability rider. Please suggest the benefits & how it works?

- Sagar

Hi Sagar, it is great that you already have a comprehensive protection net in place. Talking about the disability rider- This rider, as the name implies, provides additional coverage in the event of an accidental disability. India remains a hotbed for fatal road accidents. Nobody knows what a sudden casualty will entail. Even if the policyholder survives a major accident, he or she is likely to be permanently disabled. This not only threatens the family’s financial resources, but it also has the potential to eliminate a regular source of income. It is preferable to have an accident disability rider added to your policy to help you cope with the severity of such a loss. For example, if you choose a rider with a cover sum of 25 lakh, the insurer will pay you this cover amount if you become disabled as a result of an accident.

Hi, I am planning to buy a critical illness plan, while I do not have any critical illness now, but for comprehensive coverage, I would like to add a critical illness plan to my protection portfolio. Please guide how it works & what are the things to keep in mind before buying. I already have a health & term insurance plan in place with adequate coverage of 1 crore & 2 crores respectively.

-Sanjeev

Hi Sanjeev, you have a very comprehensive protection portfolio, which is great. Talking about the Critical Illness Plan, it provides maximum benefits to you while working differently from your regular health Insurance plan. When a critical illness, such as heart disease, cancer, stroke, major organ transplant, or any other illness covered by the plan, is diagnosed the insurer is bound to pay the entire sum insured in lump sum regardless of hospitalization costs. The lump sum payment can be used for other expenses too like to pay off hospital bills, home loan installments, investment premiums, day-to-day expenses, and other expenses that may arise as a result of lost income while you are unable to work during the treatment and recovery period. The policyholder can use the lump sum payment to pay off hospital bills, home loan payments, investment premiums, day-to-day expenses, and other expenses that may arise as a result of lost income while you are unable to work during the treatment and recovery phase. However, before purchasing a critical illness plan, it is critical that you understand its various terms and conditions. A critical illness plan typically has a 90-day waiting period from the date the policy is issued. Claims made within 90 days of the policy’s issuance are not approved by the insurance company. Furthermore, in order to file a claim, most insurers require that the policyholder survive for at least 30 days after being diagnosed with a critical illness. However, there are fewer and fewer plans on the market that provide coverage from the first day of illness diagnosis.

Queries answered by Sanjiv Bajaj, Jt. Chairman & MD, Bajaj Capital Ltd.

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