Life is very unpredictable. Only a few things can be planned. However, the fact that your family looks up to you for everything is a hundred per cent certain. The very fact of your family being dependent on you is the primary reason financial protection becomes necessary. A term insurance plan safeguards your family by providing them with a financial cushion in case of your untimely demise.
The protection becomes really robust when you combine personal accident insurance with a term plan. Moreover, this article breaks down the topic in such a way that it becomes nearly impossible not to understand.
What Is a Term Insurance Plan?
Term insurance is essentially a life insurance policy without extra frills. It acts as a financial security net for the family of the policyholder who dies within the policy tenure.
Main features:
- A fixed sum assured is disbursed to the beneficiary
- Extremely low premium cost in comparison to other life insurance products
- The policyholder receives no benefit if he/she survives the policy term
Therefore, due to its availability at an affordable price and offering adequate cover, many people search for the best term plan in India to protect their family members.
Why Term Insurance Is Necessary
Term insurance is a necessity for whoever has a source of income and dependents relying on them.
It enables your family to:
- Handle the payment of basic day-to-day expenses
- Get help in paying off the home and personal loans
- Have the means to pay for kids’ education
- Maintain financial stability
Without having the right insurance cover, your family could end up in a situation of financial hardship. With a term plan, you allow your family to carry on with their life normally even when you are not around.
What Is a Personal Accident Insurance Rider?
A personal accident insurance rider is basically an add-on cover, which you can take along with your term insurance plan just by paying a small additional premium. It offers you an extra layer of financial cover in case death or disability is caused by an accident.
An accident can happen anytime and anywhere due to:
- Road accident
- Injuries at the workplace
- Falls or burns
This rider acts as an additional safety measure in case of such unforeseen situations or accidents.
How Personal Accident Insurance Works
If a term plan has a personal accident rider, the insurance company will pay an additional amount if death is caused due to an accident.
Example:
- Term insurance cover: ₹1 crore
- Accident rider cover: ₹25 lakh
In case the death is caused by an accident:
- ₹1 crore will be paid from the term plan
- ₹25 lakh will be paid from the accident rider
Total payout = ₹1.25 crore
Thus, this additional amount can be quite helpful for the family to manage the sudden financial crunch.
Benefits of Adding a Personal Accident Rider
A personal accident rider comes with a whole list of benefits.
Extra Financial Protection
The family gets an extra payout in case of an accidental death.
Low Cost, High Value
Accident riders are inexpensive and enhance the total coverage.
Support During Disability
Certain riders also pay benefits if the accident results in a permanent disability.
Peace of Mind
You have the feeling of security when you know that your family is well taken care of.
Who Should Consider This Plan?
It is beneficial for almost everyone to have a term plan with an accident rider. Especially:
- People who commute daily
- Riders of two-wheelers
- Factory or construction workers
- Sales professionals
- Self-employed individuals
If your work or travel involves any risk, then this insurance cover is a must-have.
How Much Insurance Cover to Take?
It is critical to pick the appropriate amount for the cover.
A quick guide:
- Your term insurance cover should be 10 to 15 times your yearly salary.
Suppose:
- Your yearly salary is ₹8 lakh
- Your term cover should be ₹80 lakh to ₹1.2 crore
The extent of an accident rider cover can be anywhere from ₹10 lakh to ₹50 lakh depending on your requirements.
Things to Check Before Buying a Term Plan
Make sure that you keep these points in your mind before you confirm the policy.
Claim Settlement Ratio
Go with the insurer who has an excellent record of claim settlement.
Policy Term
Make sure that your policy lasts until the time when you stop working.
Rider Conditions
Check the details for the personal accident insurance rider thoroughly.
Exclusions
Know in advance what situations the policy here at the insurance company will not be responsible for.
Is It Better to Buy Accident Insurance as a Rider?
Personal accident insurance can be purchased separately or as a rider of term insurance. It is usually more advantageous to purchase the latter because:
- It saves you money
- It is simple to keep track of
- Along with term insurance, your premium is also paid
Thus, it is a practical option for the majority of people.
Common Myths About Term Insurance
Term Insurance Is Not Useful
It actually offers critical financial protection when you are most in need of it.
Accident Cover Is Not Necessary
Accidents, by definition, are unexpected and can lead to very high expenditure.
Only Older People Need Term Insurance
One of the advantages of buying early is that you pay less and get more years of coverage.
How to Choose the Best Term Plan in India
You just need to follow these simple steps:
- Look at the features and benefits of the term plans via online comparison sites
- Check out customer reviews and do a background check
- Determine the amount that would be enough to cover your family’s needs
- Enhance your insurance with personal accident
- Go for online purchasing to enjoy lesser premiums
Conclusion
Term insurance is a primary tool in establishing financial security. Combining that plan with a personal accident insurance rider serves to greatly increase the level of security. It is a guarantee that the family is provided with more financial support in the unfortunate scenario in which the insured person is killed or disabled as a result of an accident.
It is prudent and responsible to choose the best term plan in India with personal accident insurance. Such a plan safeguards your income and your future, as well as your dear ones. By taking measures today, your family will be safe tomorrow.
