Benefits of Buying Term Insurance with a Critical Illness Cover Rider 1

Benefits of Buying Term Insurance with a Critical Illness Cover Rider

Insurance plans offer policyholders a pure risk cover against death by paying out a lump sum amount to the beneficiary. But what if we told you that your coverage could be extended to include other perils as well? This can be done by combining your term insurance with rider benefits available at a nominal rate. By getting such add-on covers, you can maximize protection and make the most of your policy. The riders can be bought at the time of purchasing your term insurance plan. So, it’s time to find out more about the critical illness rider available with term plans and learn some of its key benefits.

Term Insurance

What Is Critical Illness Rider in Term Insurance?

Term insurance policies allow you to extend your insurance coverage by adding riders to the plan. These riders are an additional component that you can purchase for more protection against certain risks. Critical illness rider is one such popular option that most policyholders add to their term plans. Though you may not suffer from any ailments right now, as you age, the chances of getting diagnosed with an illness are higher. Such major diseases aren’t covered under the insurance policy.

So, you can ensure that your loved ones are secured and have a financial backup with a critical illness rider. Compared to the cost-effective price of purchasing an add-on cover, the rider benefit is much more as it safeguards your family. Some common critical illnesses covered are cancer, Parkinson’s disease, paralysis, Alzheimer’s disease, heart attack, heart failure, kidney failure, etc. You can use the term insurance plan calculator available online to compare the premiums offered by various insurers.

Benefits of Opting for Term Insurance with Critical Illness Rider

Here are some key benefits of purchasing a critical illness rider with your term insurance plan:

1. Financial Aid

With the increasing healthcare costs, paying for the treatment of a critical illness can burn through your savings. However, by adding the rider benefit to your insurance plan, you can avail of a lump sum payout. This amount can be used to get you the best treatment and help you recover without affecting your finances.

2. Coverage from major ailments

Though the list of critical illnesses covered under the rider may vary from one insurer to another, you get protection from numerous ailments. Most of these are major diseases that require the best medical care and nowadays are very commonly diagnosed. The rider also covers some key ailments such as open-chest CABG, permanent paralysis of limbs, stroke, open-heart replacement or repair of heart valves, angioplasty, etc.

3. Tax Benefits

You can claim the premiums paid towards your term insurance plan under Section 80C of the Income Tax Act, 1961. The premium with the inclusion of the rider can be claimed up to a limit of INR 1.5 Lakh per financial year. Thus, you can easily save up on taxes with the term insurance tax benefits.

4. Easier to manage

When compared to buying a separate critical illness insurance plan, adding a rider for similar coverage can go a long way. As it’s an add-on cover that works with your base plan, it is much more hassle-free. But an extra insurance policy has to be maintained along with the increased premium rates.

With this, you must have understood the lucrative benefits of getting a critical illness cover. Thus, you can reap the benefits of maximum coverage with the rider by paying a nominal price. Use a term insurance calculator to find out how much you would have to pay to receive coverage. Though many individuals opt for an insurance policy due to term insurance tax benefits, it is advised to avoid viewing it as a tax-saving instrument. Similar to a critical illness rider, term insurance offers numerous such features.


I am a writer, financial consultant, husband, father, and avid surfer. I am also a long-time entrepreneur, investor, and trader. For almost two decades, I have worked in the financial sector, and now I focus on making money through investing in stock trading.