The Accidental Death Benefit Rider might sound complex, but don't worry; we'll break it down into simple, easy-to-understand terms. Imagine having an extra layer of protection for you and your loved ones in case of an unfortunate accident. That's precisely what this rider offers.
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Accidental Death Benefit Rider, or ADB Rider, is an optional add-on that policyÞholders can include to their life insurance policy, whether term insurance, whole life insurance or other life policies. This rider is purely designed to provide financial protection to beneficiaries in the event of the policyholder's death due to an accident. It is one of the most affordable riders, offering ample life coverage.
An Accidental Death Benefit Rider in India is like an extra boost for your life insurance policy. Imagine you have a robust backup plan (your base life insurance) that protects your family if something happens to you. Well, this rider is like an additional feature that activates if you have an accident that unfortunately results in your passing away.
If you have this rider along with your regular life insurance, it adds an extra amount of money (a lump sum) on top of the base insurance amount. It's additional support to ensure your family is taken care of during a tough time.
Mr Rahul is a 36-year-old husband and father of a beautiful child. He has a life insurance policy with a coverage of INR 70 lakh. Considering the life uncertainties, he wisely purchased an accidental death rider with a coverage of INR 20 lakh. Although choosing this rider increased his premiums from 655 Rs to 760 Rs, it remained quite affordable.
Unfortunately, Mr Rahul met with an accident while going to his office, leading to his demise. When his wife (the nominee) claims death benefits, she receives a total amount of INR 90 lakh (base life insurance sum assured of INR 70 lakh plus ABD rider sum assured of INR 20 lakh)
Let's break down the benefits of the Accidental Death Benefit Rider.
Adding an ADB Rider to your insurance policy usually doesn't cost a lot. You pay a small extra amount with your regular premium for potentially significant additional benefits.
The ADB Rider provides additional money on top of the regular insurance coverage if the insured person passes away due to an accident. It's like having a safety net for unexpected events.
If the insured person loses their life in an accident, this rider pays out a lump sum amount to the nominee (the person chosen to receive the money). It helps the family with immediate financial needs, like bills, loans, or funeral expenses.
Knowing that you have this extra protection can give you peace of mind. Accidents are unpredictable, and having this rider ensures your family won't struggle financially if the worst happens.
You can choose how much coverage you want for the ADB Rider based on your needs and budget. It's customisable to suit your circumstances.
In case of the death of the insured due to an accident, the ADB Rider will most often pay in a short period of time, bringing much-needed financial assistance to his family in such difficult times.
Understanding the primary features is critical before purchasing or adding this rider to your base life insurance policy. Some of the characteristics include:
As per the IRDAI, you can purchase an Accidental Death Benefit Rider with coverage up to three times (3x) the base sum assured of your life insurance policy.
ACKO Life Accidental Death Benefit Rider is a traditional, non-participating rider that offers a lump sum death benefit due to an accident.
Usually, you need an insurance policy before you qualify for this rider. The ACKO Life Flexi Term Plan offers flexible coverage that fits your ever-changing life! While the accidental benefit rider is added at an extra cost, it is an excellent financial planning tool to consider.
Sum Assured (Min): INR 10 Lakh and in increments of INR 5 Lakh. The amount is paid on the policyholder’s death
1. caused by bodily injury due to an accident and
2. the bodily injury is sole, direct and independent of any other causes
3. The death occurs within 180 days of the accident but before the cover expires.
There are a few cases where no benefits will be payable. Let’s understand some of the standard exclusions of ABD Rider.
1. Intentional self-inflicted injury, attempted suicide, while sane or insane
2. Death under the influence of drugs, alcohol, narcotics, etc.
3. Caused due to war, invasion (whether war be declared or not)
4. Engaging in flying activity, except as a bona fide, fare-paying passenger of a recognised airline or Pilots and cabin crew of a commercial airline
5. Participation by the insured person in a criminal or unlawful act with illegal or criminal intent
6. Engaging in professional sport (s) or any hazardous pursuits, including diving, riding, underwater activities, etc.
Plus, any other exclusions under the general provisions of the basic life policy.
The following table lists the differences between Accident Death Rider and Term Life Insurance.
| Aspect | Term Life Insurance | Accidental Death Benefit Rider |
| Purpose | Provides a lump sum amount if you pass away within a specific period (e.g., 10, 20, 30 years) | Provides an extra amount if death is due to an accident during the policy term. |
| Coverage | Covers death from various causes (illness, natural causes, accidents, etc.). | Covers death specifically due to accidents during the policy term. |
| Payment to Beneficiaries | Lump sum to beneficiaries in case of your death (subject to policy conditions). | Additional payout to beneficiaries if death is due to an accident (in addition to the regular insurance payout). |
| Cost of Rider | Typically involves an additional premium. | Requires an extra premium beyond the base insurance premium. |
| Duration of Coverage | Covers a specific term (e.g., 10, 20, 30 years) | Aligns with the term of the base insurance policy |
| Scenario of Payout | Payout on death, irrespective of the cause | Payout only if death occurs due to an accident |
Understanding the pros and cons of an ABD rider is crucial for making informed decisions. Hare the pros and cons of the Accidental Death Benefit Rider:
| Pros | Cons |
| Financial Security for Loved Ones: This rider pays the family extra money - above the regular life insurance payout - if you die as a result of an accident and not from natural causes. It can provide much-needed financial relief for them during a difficult time | No Payout for Non-Accidental Death: This rider will not pay an additional payout for non-accidental death. Therefore, if you seek wider coverage, you may very well want to opt for something else. |
| Low Cost and Easy to Add:Adding this rider to your life insurance policy is simple and usually inexpensive. For a small extra amount, you can get significant additional coverage. | Limited Coverage: This rider only provides benefits in case of accidental death. It doesn't cover natural death or other causes like illness. |
| Supplement to Health Insurance: While health insurance helps with medical expenses after an accident, the accidental death benefit rider gives your family an extra lump sum amount that can cover other costs or act as a financial cushion. | Specific Conditions Apply: The rider might have specific conditions or definitions for what qualifies as an accident. Understanding the exclusions is important to ensure your family receives the benefit. |
Here is a list of factors to consider before purchasing the Accidental Death Benefit Rider.
Think about how much extra you'll pay for this rider. Make sure it fits your budget and is worth the added protection.
Check how much money your loved ones would receive if something unfortunate happens. Make sure it's enough to support them.
Understand what counts as an accident. It's usually unexpected events like a car crash or a fall. Make sure the coverage matches your lifestyle.
Look out for what isn't covered. Some risky activities might not be included, so be aware of those.
Learn about how to make a claim in case of an accident. Easy and straightforward processes are always a plus.
Know how long the rider will cover you. Some last for a specific period, while others might be lifelong.
Check if it fits well with your existing life insurance policy. You want them to work together seamlessly.
Jump Tag IconChoose a reliable and reputable insurance company. You want to be sure they'll be there for you when needed.
Getting advice from a financial advisor when you're thinking of getting an Accidental Death Benefit Rider in India is important. Think of it like having a wise friend to help you make the best decisions.
The Accidental Death Benefit Rider is like an extra layer of protection, especially for accidents. However, determining the amount of extra coverage you should add isn't easy. This is where you may want to talk to a financial advisor - they are professionals who can advise you on the right level of cover.
They will ask questions to assess your requirements and budget. Accordingly, they'll recommend the top choices for you. So, consulting a financial advisor is like having a helpful friend who ensures you're well-prepared and protected, giving you a sense of security for whatever comes your way.
Here are the documents that may be required to claim against the Accidental Death Benefit Rider.
This is a crucial document that officially states the cause and date of the person's passing. You can get this from the local authorities where the person passed away.
If medical treatment was given before the accident, any records or reports related to it could be necessary. It helps to provide a clear picture of what happened.
If the accident was reported to the police, obtaining a copy of the accident report can be important for the claim.
A detailed description of the accident, including when and where it occurred, and how it happened. The insurance company needs to understand the circumstances.
Keep a copy of the insurance policy handy. It contains essential details about the coverage and conditions of the Accidental Death Benefit Rider.
This is a standard form provided by the insurance company. Fill it out accurately with all the required details.
If there were any witnesses to the accident, their statements can be helpful to validate the claim.
Provide identification and address proof of the claimant. This could be a passport, Aadhaar card, or any other government-issued ID.
Information about the bank account where you want the claim amount to be deposited.
Accidents can happen suddenly and unexpectedly, and this rider steps in to give your family extra money if you pass away due to an accident. It's an added layer of protection.
Whether you need it depends on your lifestyle and circumstances. Just like you'd wear a helmet while biking for extra safety, an Accidental Death Benefit Rider is extra safety gear for your life insurance. It's all about being prepared for the unexpected.
Here are some common questions about Accidental Death Benefit Rider In Life Insurance.
Disclaimer: The content on this page is generic and shared only for informational and explanatory purposes. It is based on industry experience and several secondary sources on the internet, and is subject to changes.
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