ULIP Riders Explained

A Unit-linked Insurance Plan (ULIP) is designed and structured in a way that takes care of both your life insurance and investment needs. Yet, there might be some unforeseen circumstances in life which might deter your ability to earn, such as a permanent disability or a critical illness. To get a complete protection against life's many exigencies or unforeseen events, you can add insurance riders to your ULIP policy.

Riders can be purchased with your ULIP policy by paying a nominal charge. It is a good way of customizing your unit-linked insurance plan to enhance your protection. When you buy a rider, you are basically adding new benefits to your existing insurance policy by paying a small charge.

Here are some of the extra benefits you can add to your existing ULIP :

1. Waiver of Premium Benefit Rider :

If your regular income is impacted for some reason, like permanent disability due to an accident or inability to work due to a critical illness, then a waiver of premium rider ensures that all future premiums towards your ULIP gets waived and your investment and life cover continues unhindered. This ensures that the life goals of your loved ones can continue to be met even if you are not in a position to earn. The conditions eligible for benefit under this rider are defined in the policy document.

2. Accidental Death Benefit Rider :

This rider adds an extra layer of financial help, over and above the life insurance cover provided by the ULIP, in case of death of the insured person due to an accident. Here, the nominee gets an additional benefit of rider sum assured along with the death benefits of the base ULIP plan. The maximum cover under the rider could be equal to the sum assured under the base policy i.e. if the base ULIP has Rs 10 lakh life cover, then you can buy a maximum accidental cover up to the same amount through this rider.

3. Accidental Permanent Total/Partial Disability Benefit Rider :

This rider pays out a lump sum amount in case the life assured suffers from total or partial disability due to an accident, depending upon the rider terms and conditions. Adding this rider to the ULIP base policy will ensure that you and your family need not worry about the lack of finances to meet your life goals.

4. Critical Illness Benefit Rider :

When a serious illness strikes, you need financial support to get the best possible treatment. You don't want your savings to be eroded because of the medical expenses. Adding Critical illness benefit rider to your ULIP policy allows you to get a lump sum amount in case any one of the critical illnesses (covered under the policy) strikes you, thus covering yourself and your family from the financial impact of such illnesses. These illnesses may include cancer of different kinds, first heart attack of a certain severity, kidney failure requiring regular dialysis, organ transplant, major paralysis etc.

5. Family Income Benefit Rider :

This rider provides financial support on the earlier occurrence of death of the life assured, accidental permanent total disability or first diagnosis of any of the specified critical illnesses under the policy. Typically, 1% of the rider sum assured is paid monthly under this rider, subject to a minimum of 10 years. With the regular monthly income your family can continue to achieve their life goals, without any worries.

Adding a rider to your existing ULIP enhances its overall value and benefits. It provides protection to you and your family against various unforeseen events, without having to buy another insurance policy. Through riders, you can ensure yours and your family's life goals are on track, and aren't impacted by any financial constraint.