Your Guide To Critical Illness Riders

By Sanesh Mathew | July 7, 2016

Critical Illness

Today, people are becoming more and more aware of the importance of an insurance policy and most of the smart ones are flocking towards Term Insurance plans. The reason? Term Life Insurance policies aren’t only cheaper than other types of Life Insurances, it is the simplest of the kind that provides you with a high cover at a low premium.

Now a Term Plan will certainly secure your family in case you are not around but what if you suffer from a critical illness such as a heart attack, cancer or a stroke? What if, as a consequence, you become temporarily disabled and are unable to work or earn a living? This is where a critical illness rider comes into play.

Additional Reading: Popular riders on Term Insurance!

A critical illness rider provides adequate cover for critical ailments (such as cancers, a stroke, heart attack etc.) which usually require expensive medical treatments and have long recovery periods. Besides, these ailments diminish the affected person’s ability to work, making things difficult for the person as well as their family. A critical illness rider is your (and your family’s) best bet against such life-threatening illnesses.

Features of a Critical Illness Rider

  • A Critical Illness Rider is basically a safety net for the dark days (i.e when you’re diagnosed with a serious illness).
  • The sum assured is paid as a lump sum amount if the policyholder is diagnosed with any of the critical illnesses mentioned in the policy.
  • These riders are not applicable to pre-existing diseases or hereditary conditions.
  • The Critical Illness Rider can be claimed only if the policyholder is diagnosed after a predetermined waiting period.
  • The lump sum received after diagnosis can be used for any purposes by the insured.
  • The documentation is simple and the claim process is hassle-free.
  • A critical illness rider, along with your Term Insurance plan, can fetch you tax deductions under Section 80D of the Income Tax Act.

Here are some of the top Critical Illness Plans available in India:

HDFC ERGO Critical Illness Plan

This plan comes in two variants – Silver and Platinum. Both these plans are quite similar. They  differ only in the number of critical illnesses covered under each plan.

  • This policy covers individuals within the age group of 5 to 45 years.
  • There is a waiting period of 90 days from the policy purchase date during which you cannot make a claim.
  • Policyholders can claim tax deductions up to Rs. 15,000 under Section 80D. (Senior citizens get up to Rs. 20,000 as a tax benefit.)
  • The grace period for policy renewal is 15 days.
  • The sum can be used for paying for treatment, paying off debts, expenses related to lifestyle changes, etc.

Bajaj Allianz Critical Illness Plan

  • Anyone between 18 to 65 years is eligible for this plan.
  • In the case of dependent children, the entry age is between 6 to 21 years.
  • This is an annual policy which comes with lifetime renewability.
  • Once the insured is diagnosed with any of the ten critical illnesses mentioned in the policy, a lump sum amount will be paid to the policyholder.
  • However, the benefit amount is payable only after the insured survives 30 days after being diagnosed.
  • The plan comes with competitive premium rates.

Religare Assure Health Insurance Plan

  • A Critical Insurance Plan for individuals above 18 years of age. The maximum entry age for the policy is 65 years.
  • The plan offers lifelong renewability.
  • There is no co-payment option as the lump sum benefit gets paid once the individual is diagnosed with any of the critical illnesses mentioned in the policy.
  • 20 critical illnesses are covered under this plan.
  • This plan does not cover pre-existing illness.

Apollo Munich Easy Health Standard Plan

  • Anyone between 5 years and 65 years of age can opt for this plan.
  • It has a lifetime renewability option with a grace period of 30 days for renewing the policy.
  • The sum insured for the critical illness cover should be within Rs. 1 lakh and Rs. 10 lakh.
  • This plan will cover pre-existing conditions only after a waiting period of three years.

In a nutshell, getting a critical illness rider along with your Term Insurance Plan assures a steady cash flow during your recovery period. In addition to this, it comes with other benefits such as double tax benefits and a large cover that can take care of your hospitalisation needs as well as day-to-day needs.

Do you think it is a good idea to get a critical illness cover with your Term Insurance? Leave your thoughts in the comments section below.

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Category: Health Insurance Insurance
Sanesh Mathew

About Sanesh Mathew

A talkative sleepyhead, Sanesh, enjoys watching horror movies, listening to music, reading all things related to personal finance and wandering aimlessly (walking meditation, he calls it!). He refers to himself as a 'simple human being with a rather chaotic mind'.

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