Riders offer financial cover over and above the basic sum assured in a life insurance policy.
HDFC Life Insurance has launched a rider called Protect Plus which provides coverage against cancer, accidental death and disabilities. Most insurers allow adding riders at the time of buying the policy or at policy anniversary. In the case of the newly-launched Protect Plus by HDFC Life, the insurer is allowing it to be added in a variety of its existing plans.
A rider is essentially an optional feature or a coverage that a policyholder can add to the basic policy. The additional coverage is generally to provide coverage for other kind of risks. For example, if one buys a Term Insurance plan, he or she may add health insurance coverage as a rider. For the policyholder riders comes at an additional cost, therefore, choosing the right rider is important.
Riders offer financial cover over and above basic sum assured in a life insurance policy. Even with the occurrence of the event, the life cover remains intact which means that even if you have used a particular rider, you remain eligible for the death benefit on the life insurance plan.
Protect Plus – What it covers
1. The Cancer Cover pays 25% of the rider sum assured on diagnosis of early-stage cancer or Carcinoma-in-situ (CIS). In case of being diagnosed with major stage cancer 100% of the rider sum assured is paid out (less any payout made for early-stage cancer/ CIS).
2. The Personal Accidental Cover provides coverage against three unfortunate eventualities of an accident:
a. In the event of death due to accident: it pays 100% of the rider sum assured in addition to the claim amount payable under the base policy.
b. In the event of Total Permanent Disability: a regular monthly income equal to 1% of Rider Sum Assured is paid for the next 10 years.
c. In the event of Partial disability: a certain percentage of Rider Sum Assured (10%-75% depending on type of disability) is paid out.
3. The Accidental Death Cover pays 100% of the rider sum assured in addition to the claim amount payable under the base policy in an unfortunate event of death due to accident.
One can opt for this rider with term plans as well as savings and investment plans, both traditional and Unit Linked insurance plans. The idea is to enhance the cover thereby providing additional financial protection for self as well as the family in case of an unfortunate event.
Some of the insurance products with which one can purchase this rider include Click 2 Protect Plus, Click 2 Protect 3D Plus, HDFC Life Sanchay, HDFC Life Sanchay Plus, HDFC Life Sanchay Par Advantage, HDFC Life Click 2 Invest, HDFC Life Click 2 Wealth, HDFC Life ProGrowth Plus, etc.
What to do
For a more comprehensive coverage one should cover risk from disability or from critical ailments such as cancer. Adding a rider helps in keeping all risks covered in one place, however, one may also alternatively buy a cancer insurance plan or a plan covering accidental death. Evaluate the cost-benefit of buying them separately or as a rider but more important is that the risks from all fronts need to be covered for adequate protection of your savings.