Term Insurance with Critical Illness Rider

What is a Critical Illness Rider?

A Critical illness rider is a popular rider that helps the policyholder in providing financial support in case they are diagnosed with a critical illness during the plan term. Critical illness is a dangerous and life-threatening ailment such as stroke, kidney failure, cancer, and others. This rider enhances the cover. When you buy term insurance plan with critical illness cover option, you can claim the sum assured amount on the diagnosis of a critical illness covered under your plan. The payout money can then be used to pay off ambulance charges, the fees of doctors, or medical expenses.

The term insurance with critical illness rider can be bought during the inception of the policy or any subsequent policy year of the base plan. This additional benefit can be availed by including the term rider in the base plan at nominal premiums payable with the base premiums.

Note: Now that you know that what is Critical Illness Rider, you should also get to know about what is term insurance to buy a term plan for your loved ones.

Term Insurance with Critical Illness Cover in India 2025

Here is a list of all best term insurance plans with critical illness cover available in India in 2025.

*Disclaimer: ˜Top 5 plans based on annualized premium for bookings made on https://www.policybazaar.com in the first 6 months of FY 24-25. The above plans and premiums are for *1 Cr sum assured for 18 years old with 20 years policy term. Standard T&C Apply. Price would vary basis your profile. Prices offered by the insurer are as per the IRDAI-approved insurance plans. Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by any insurer. This list of plans listed here comprise of insurance products offered by all the insurance partners of Policybazaar. For a complete list of insurers in India refer to the Insurance Regulatory and Development Authority of India website, www.irdai.gov.in

Disclaimer: Policybazaar does not rate, endorse or recommend any specific insurance provider or insurance product offered by any insurer.

Diseases covered under a Term Insurance with Critical Illness Rider in India

Here is a list of all the ailments covered under a term insurance with critical illness rider included in it. The accurate list of critical illnesses covered under each plan differs with different insurance companies, thus it is advised to go through the policy documents to get a better understanding of all the illnesses covered under a specific plan.

How Does Term Insurance with Critical Illness Rider Work?

Let us understand the critical illness rider in a term insurance plan using an example. Suppose two people, Niharika and Sania have purchased a term insurance plan.

As seen above in Niharika’s case, the term plan pays out only in case of an unfortunate death. If Niharika had been diagnosed with a critical illness, she would not have received any benefit amount because her term insurance did not have the critical illness rider included in it. On the other hand, Sania received the rider sum assured on diagnosis of a critical illness and her nominee will be eligible to receive a death benefit in case of her untimely death because she purchased a term plan with critical illness rider. Sania can use the rider sum assured to pay for her medical treatments and recover in peace without worrying about the payment of hospital bills.

Note: You can calculate the premiums for your term of choice using the term insurance premium calculator.

How Much Critical Illness Cover Do I Need With Term Insurance?

Before purchasing the most suitable term insurance with critical illness cover, you need to make sure you are choosing the right cover amount for your critical illness rider benefit. Since the insurer will pay this rider sum assured in case of diagnosis of a critical illness, you need to make sure that the cover amount is enough to help you cover your medical bills in the future (keeping in mind the increasing costs of medical bills due to the rising inflation) and your family’s needs in case you lose your job due to ailment. 

A lot of insurance companies also offer the option of including a waiver of premium on critical illness rider, which waives off any remaining premiums in case you are diagnosed with a critical illness. This way you can be relieved from the stress of having to pay the remaining premiums while recovering from the critical illness.

Benefits of Term Insurance with Critical Illness Rider

Critical illness term insurance offers the following benefits:

• Lump sum benefit- One go

  Critical illness rider benefit helps the life assured to manage the expenses related to treatment by paying a lump sum amount. The policyholder receives all the money at one time which helps the policyholder pay for the treatment expenses without any worry.

• Income replacement:

  In the event of your job loss due to a critical illness, the claim received from the term plan with critical illness rider can be used as replacement for your income. You can use this amount to pay your monthly bills like rent or children’s fees and other requirements.

• No change in premium amount

  The premium amount for your term insurance with critical illness cover will remain the same even on the critical illness diagnosis. This means there will be no increase in premium rate within the same plan due to a new critical illness. Furthermore, if the plan offers a Waiver of Premium (WOP) on Critical Illness (CI) then all the remaining premiums for your term plan will be waived saving you the worry of having to pay the remaining premiums.

• Large Cover

  The cost of treatment for critical illnesses such as heart attack, kidney failure, cancer, and others is very high in India that can burn your pocket in no time. The critical illness rider with term plan offers comprehensive coverage against various critical illnesses at a nominal additional premium rate.

• Dual Tax Benefit

  Term insurance with critical illness cover allows policyholders to get tax benefits as per the prevailing laws u/s 80C and 10(10D) of the Income Tax Act, 1961. Buying a critical illness rider along with a base term plan doubles the tax benefit as it adds tax benefit under section 80D, thus increasing their benefit.

• Increase in Survival Chances

  With the rising cost of critical illness treatment in India, there are many individuals who leave treatment in middle because of insufficient funds. Opting for a critical illness rider to support you over your term plan will make sure that you will never be in a position to compromise your treatment due to lack of funds. Simply put, this rider payout can help you increase your survival chances by allowing you to pay for your medical expenses and allow you to focus on your stress-free recovery.

Who Should Buy a Critical Illness Term Insurance?

Following are the types of individuals who could benefit from a critical illness rider added as their base term insurance add-on.

• Individuals with a history of critical illnesses in the family: If you have any serious ailments running in the family there is a slight chance of you suffering from the same illness in the future. Therefore if you purchase the term insurance plan while you are still healthy and young, you can get coverage against these illnesses at an affordable premium rate.

• Sole Income earners: People who are the only breadwinners of the family will be majorly affected by the loss of income in case they get diagnosed with a critical illness. They will not only be burdened with expensive hospital bills but also find it difficult trying to stay above their rent and child’s fees. Term insurance with critical illness cover can help the family take care of these expenses while the policyholder focuses on their speedy recovery.

• People above 40 years of age: People often start developing more ailments as their age increases. Term plan with critical illness rider can help people over the age of 40 secure their future in case they are diagnosed with a critical illness.

• People within high-pressure jobs: Stress and an unhealthy lifestyle are one of the leading causes of a lot of critical illnesses. Now it may not be possible to change the high-pressure job but as a preventive measure, you can buy term plan to protect yourself in case of an eventuality.

Eligibility Criteria of a Critical Illness Rider

Let us take a look at the eligibility conditions for critical illness term insurance:

How to Buy Term Insurance With Critical Illness cover?

Follow the below steps to buy a term plan with critical illness from the comfort of your home in just a few minutes.

• Visit the Term insurance page

• Enter your basic information like name, gender, contact information, and date of birth

• Fill in your annual income, occupation type, educational background, and lifestyle habits like smoking and drinking

• Select the most suitable term insurance with critical illness cover and proceed to pay

How to Claim Term Insurance with Critical Illness Cover?

You can claim the critical illness rider benefit of your base term insurance plan on the diagnosis of the listed critical illness during the policy term in the following way:

• Step 1: Submit the insurance company’s claim form along with the medical certificate 

• Step 2: Attach the non-relation certificate for pre-existing illnesses or injury

• Step 3: Provide the test reports of the respective critical illnesses

• Step 4: Submit the latest statements, KYC, and other required documents

Key Takeaways About Term Insurance With Critical Illness Rider

Let us take a look at some of the things to consider before buying term insurance with critical illness cover:

• The amount of life cover selected under the policy is payable in case of the assured’s demise to the family of the policyholder.

• On diagnosis of a critical illness covered under the plan, the amount of benefit payable will be equivalent to the rider sum assured of the critical illness chosen.

• The benefit will be payable during the 1st diagnosis itself as there no minimum duration of survival is required.

• Every term insurance with critical illness cover offers coverage against separate illnesses and has a distinct set of T&Cs for different plans.

• The critical illness rider can enhance the policyholder’s survival chances by offering money to pursue the treatments available.

• Make sure you are aware of any waiting period or survival period to avoid future confusion.

• The payment of the premium can be done in a single lump sum, or regular installments for a limited period or the whole policy tenure.

• You will be eligible to avail of tax benefits under sections 80D and 80C of the Income Tax Act, 1961.

Documents Required to Claim Critical Illness Rider

Here is a list of all the documents you would need to claim your term insurance with critical illness rider:

• Duly filled claims form

• Original policy documents

• Assured’s valid ID and address proof

• All pre and post-hospitalization records

• Medical test reports showing the diagnosis of the covered critical illness

• Medical reports attending medical practitioner’s certificate

• Assured’s copy of the canceled cheque or bank statement

Final Thoughts

Due to people’s hectic schedule these days, everyone is at the risk of getting diagnosed with critical illnesses like cancer or cardio-vascular ailments before they reach the age of 70. The treatments for these critical illnesses can lead to a massive financial burden on the family as the treatment costs for these diseases can easily run into lakhs. Opting for one of these term insurance with critical illness coverage in India will surely prove to be helpful for you in the long run.

Note: Check all the best term insurance plan in India.

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