Should you buy the Accidental Disability Rider with Term Insurance?

Regardless of how well you maintain your health and lifestyle, sometimes it is impossible to escape certain situations like- an accident. Unlike an infection or disease, which usually takes time to spread across your entire body, an accident can happen at any point in time and does not come with a warning. The minute you hear about an accident, you are likely to immediately picture a road accident in your mind. However, you must note that an accident can occur anywhere. Data suggests that a majority of accidents usually take place at home. like- slipping from the staircase at home, getting electrocuted, and so on.

An accident can either lead to death or cause a disability. When someone meets with an accident that causes disability, it does not just affect them physically but also causes mental and financial distress. It also comes with additional lifestyle costs like accessible property, furniture, vehicles, making alterations across the house, etc. Such situations cast a huge financial impact on your finances and your family's lifestyle.

If you want to protect your family from the financial risks of accidental disability, we would recommend that you invest in a good personal accidental cover. There are two ways to get a personal accident cover-

1. As a Rider along with your term insurance or health insurance policy
2. As a Separate policy. 

In this article let us learn and compare the two options and further find out which option will be suitable for you. 

Comparing an Accidental Disability Rider and Standalone Personal Accident Cover 

How does the Rider work?

Riders are optional & additional benefits that can be bought along with the purchase of a core term or health insurance policy. The Accidental Rider is one such additional benefit. In fact, in term insurance, there are two kinds of Accidental Riders -

1 - Accidental Disability Rider

In this rider, you and your family will receive a sum of money in case a disability occurs due to an accident. It provides you with fixed cash, to help you cover your additional lifestyle expenses

However, you can only buy a limited sum assured of a personal accidental disability rider and it is usually a certain percentage of the term insurance sum assured. This is hardly sufficient in most cases over the long run.

2 - Accidental Death Benefit Rider 

Under this rider, your family or nominee will receive an additional sum of money in case you pass away due to an accident. This can be a useful rider especially for people who prefer the convenience of purchase and not managing multiple insurance policies. 

One limitation with riders is that they are always tied to the core product. For any reason if you discontinue the core product, your rider cover also lapses. 

How does a personal accident insurance plan work?

Besides buying the personal accident cover as a rider with term or health insurance, you also have the option of buying a separate personal accident cover to help your family be protected from the financial risks associated wh accidents.

These can help you cover a large range of accidental disabilities, such as - 

1 - Permanent total disability

This includes irrecoverable injuries which lead to permanent loss of a critical body function as a result of loss of a core body part e.g. loss of both eyes, loss of both hands , loss of both legs, loss of one hand, and one leg, etc. Here, the individual’s life changes upside down and they become entirely dependent on their family at least for a good period. In such a situation the person and his family are provided with 100% of personal accident sum assured to further help them with their financial needs. 

2 - Permanent Partial Disability

Partial loss of a core body function is termed permanent partial disability e.g. loss of one limb, loss of one eye, etc. In such cases, the personal accident policy offers you a certain percentage of the cover amount. 

3 - Temporary Total Disability

In case of an injury that has led to you becoming bed-ridden for a few weeks, the policy provides you with a cover of 1% sum assured every week. For example- you’ve purchased a standalone accidental policy of Rs 20 lakhs, and you meet with an accident that has led to a spinal injury that requires you to take complete bed rest for a couple of weeks. In such a case, you will receive a sum assured of Rs 20,000 every week to help you and your family cover the cost of the injury. 

4 - Accidental Death

All standalone/comprehensive personal accident plans offer full sum assured as lump sum payout on accidental death.

Which one should you choose? 

A comprehensive personal accident cover (standalone policy) is a low cost product that every earning member of the family should buy. In general, a standalone cover gives a much better, comprehensive coverage - compared to Riders. 

So, we recommend that you always choose a standalone cover, instead of a rider which could come with coverage limitations. 

If you have any further doubts or queries about personal accidental insurance or accidental disability rider, you can post it on the Beshak Insurance Forum and get answers from insurance experts within 6 to 8 hours, for free. 

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Check out Beshak TruMatch -  the first-ever term insurance recommendation engine that recommends the right customizations you must pick so that your term plan is perfectly tailored to your family’s needs.