A term insurance policy with accidental benefit comes in handy in covering the insured in case of accidental death or injuries.
It is a rider benefit that can be availed at an additional premium.
Since term insurance is a simple policy, unlike life insurance, a person can have added benefits or added monetary relief with the help of riders. To provide additional cover to a person in case of an accident, one can purchase an Accidental Death Benefit rider. This article is all about Accidental Term Insurance and its benefits. Read along!
Life is unpredictable and to protect one’s family under a financial umbrella, a person purchases term insurance. Accidental Term Insurance provides an additional monetary relief over the base insurance. A person with term insurance is covered against any death wherein the nominee is paid the death benefit or the Sum Assured as a lump sum amount or part lump sum and part monthly income, as the life insured chose while purchasing the policy.
Unlike the term insurance, Accidental Term Insurance, with accidental death benefit rider, provides an additional amount to the nominee along with the base amount. For example, if a person has a Sum Assured of Rs 45 lakh on the base policy, a person can add the accidental death benefit rider and increase the Sum Assured. If the rider has a sum assured of 20 lakh, the Sum Assured that the nominee would receive in the event of the demise of the life insured due to accident will be 65 lakh. If the person dies due to other reasons than an accident, the nominee is paid only the base Sum Assured as per the policy.
The person is also required to pay additional premiums for the rider if opted for. Accidental Term Insurance and regular term insurance offers no benefits on the maturity of the policy. Although some insurance companies offer maturity benefits, these are called Return of Premium policies (TROP or ROP). These plans, too, can have accidental death benefit rider.
Pure term insurance is void of maturity benefits. If the life insured survives the policy’s tenure, the person is not entitled to returns of the premiums. If the life insured passes away, a pre-defined amount of Sum Assured shall be paid out to the nominee. Even though it has no maturity benefit, there are loads of other benefits offered on term insurance. A person, whether a sole earner or an individual beginning to start a family, should consider purchasing some sort of insurance like term insurance, or term insurance with a return of premium.
Though term insurance have limited benefits, term insurance can be made solid with the addition of rider protection. These riders offer protection against various circumstances. Accidental death benefit policy covers the insured against accidental disability and permanent disability, etc., Pure term insurances have lower premiums compared to other insurance plans. With the addition of riders, one has to pay additional premiums for the added benefits.
Accidental Term Insurance has a host of benefits and features. This sort of policy is mainly advised for the people who work in conditions where they are constantly surrounded by danger. Some of the features of the policy are as follows:
The perks of accidental term insurance are numerous. Apart from having high Sum assured values, these policies also have multiple death benefit options, various additional riders, critical illness coverage, return of premium option, income tax benefits, and accidental death benefit as suggested in the name. to mention a few are:
Under the policy, there are certain exclusions that a person must be aware of. These are usually mentioned to the customers before purchasing the policy, but it is crucial that a person digs deep and knows well about the exclusions. Some of the exclusions are as follows:
No death benefits are paid out in case:
The minimum age at entry for term insurance is 18 years, and a maximum could be anywhere between 55 or 65 years. To purchase a policy, the person must already be working and earning some sort of income. He/she should be a citizen of India to purchase accidental term insurance in India. PIOs and NRIs too can purchase term insurance in India these days.
To purchase the accidental term insurance, one must submit a predefined set of documents for file keeping. These are called the Officially Validated Documents (OVDs). These documents conform to the KYC norms, and a person is mandated to submit the same. Failing to provide either one of these will nullify the insurance if already in force. The documents required are as follows:
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