The usefulness of an accidental death benefit rider

Written by: Deepak Yohannan
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The usefulness of an accidental death benefit rider
As the old saying goes, you are born, you die and in between you make many mistakes. Mistakes are sometimes unintentional and you make them simply out of ignorance. For instance, you buy a life insurance policy and leave out the riders that actually prove to be beneficial.

One such rider is the accidental death benefit rider. With the help of this, you get a lot more out of your life insurance policy. With paying, say, a few hundred rupees extra every month you get almost double the benefit at the time of an accidental death. A young person usually gets a to protect his family in his absence. But look at it closely and you will notice that most young people die due to accidents as very few are affected by fatal illnesses. So opting for an accidental death benefit rider makes a lot of sense.

Definition

In dictionary terms, this is a rider that will provide an extra benefit to the assured sum of the rider if there is an accidental death.

Advantage

Like mentioned above, the accidental death benefit rider will provide your family with an extra amount of money in your absence. Lets take an example. Mr. Dutta buys a life insurance policy of Rs.20,00,000 and agrees to pay Rs.10,000 every month as premium. If he pays just Rs.600 more monthly, he will be entitled to the accidental death benefit rider. Now, if he dies in the tenure of the policy in an accident, his nominee will get a benefit of Rs.35,00,000. If he had chosen not to pay the additional Rs.600 every month, his nominee would only get a benefit of Rs.20,00,000. So it can be clearly seen that a mere extra payment of Rs.600 proves to be of immense help and so it is very advisable to go for this rider.

Exclusions

While an accidental death benefit rider is a huge boon to any modern day policyholder, you must be aware of the exclusions. Nothing causes more distress to a family than having to run from pillar to post while recovering the benefit and that too while having to deal with the death of a loved one. So protect your family from the unpleasant situations by being aware of the exclusions of the accidental death benefit rider. Remember that the rider will not be valid if death is caused by:

1. Drug, alcohol or substance abuse
2. Suicide or any other form of injury inflicted upon self
3. Criminal activities (if the policyholder is directly responsible or a part of any criminal activity leading to death)
4. War or any other civil violence
5. Nuclear infectivity
6. Air accidents, except when the policyholder is a passenger on a licensed commercial jet
7. Injuries sustained in a hazardous sport
So keep the exclusions in mind and opt for the accidental death benefit rider if you haven't already. Remember that it cannot be purchased individually and only comes along with a regular life insurance policy. The benefits are many and the risks are few, making this rider one of the most useful life insurance tools available today.

For more articles by Deepak Yohannan, please visit MyInsuranceClub.com

GoodReturns.in

Read more about: insurance
Story first published: Friday, August 31, 2012, 9:36 [IST]
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